Medicare beneficiaries in health plans with a three-tiered drug benefit had lower drug expenses and filled fewer prescriptions than people in plans with no tiers after controlling for demographic factors, health status, and medical copayments according to a study published in Health Services Research. On average, beneficiaries in employer-?sponsored retiree health plans incurred $313 less in annual drug expenses and filled 6.7 fewer prescriptions than those in plans without tiers. This was a 14.3 percent and 14.6 percent reduction in drug cost and use, respectively. However, those in three-tiered plans had higher out-of-pocket expenses than those in plans with no tiers.

When the researchers looked specifically at expenses for long-term maintenance drugs to treat chronic conditions, they found that Medicare beneficiaries were less responsive to cost-sharing requirements and more likely to shift into generic substitutes, implying that “multitiered plans may curtail inefficient use, without necessarily curtailing utilization of drugs that have beneficial consequences,” says Boyd Gilman, senior researcher at Mathematica Policy Research.

“Multitiered copayment structures may be effective in controlling costs for the plan, but insurers have to be careful because they may also introduce barriers to care. Insurers need to be sensitive to whether or not you sacrifice access to important, necessary drugs for greater cost control,” says Gilman.

“Our results show that multitiered plans may induce more efficient use of drug resources without sacrificing access to essential medications,” adds John Kautter, coauthor and senior economist at RTI International, a research company. The study was based on drug claims before the implementation of the Medicare Part D outpatient drug program.

Managed Care’s Top Ten Articles of 2016

There’s a lot more going on in health care than mergers (Aetna-Humana, Anthem-Cigna) creating huge players. Hundreds of insurers operate in 50 different states. Self-insured employers, ACA public exchanges, Medicare Advantage, and Medicaid managed care plans crowd an increasingly complex market.

Major health care players are determined to make health information exchanges (HIEs) work. The push toward value-based payment alone almost guarantees that HIEs will be tweaked, poked, prodded, and overhauled until they deliver on their promise. The goal: straight talk from and among tech systems.

They bring a different mindset. They’re willing to work in teams and focus on the sort of evidence-based medicine that can guide health care’s transformation into a system based on value. One question: How well will this new generation of data-driven MDs deal with patients?

The surge of new MS treatments have been for the relapsing-remitting form of the disease. There’s hope for sufferers of a different form of MS. By homing in on CD20-positive B cells, ocrelizumab is able to knock them out and other aberrant B cells circulating in the bloodstream.

A flood of tests have insurers ramping up prior authorization and utilization review. Information overload is a problem. As doctors struggle to keep up, health plans need to get ahead of the development of the technology in order to successfully manage genetic testing appropriately.

Having the data is one thing. Knowing how to use it is another. Applying its computational power to the data, a company called RowdMap puts providers into high-, medium-, and low-value buckets compared with peers in their markets, using specific benchmarks to show why outliers differ from the norm.
Competition among manufacturers, industry consolidation, and capitalization on me-too drugs are cranking up generic and branded drug prices. This increase has compelled PBMs, health plan sponsors, and retail pharmacies to find novel ways to turn a profit, often at the expense of the consumer.
The development of recombinant DNA and other technologies has added a new dimension to care. These medications have revolutionized the treatment of rheumatoid arthritis and many of the other 80 or so autoimmune diseases. But they can be budget busters and have a tricky side effect profile.

Shelley Slade
Vogel, Slade & Goldstein

Hub programs have emerged as a profitable new line of business in the sales and distribution side of the pharmaceutical industry that has got more than its fair share of wheeling and dealing. But they spell trouble if they spark collusion, threaten patients, or waste federal dollars.

More companies are self-insuring—and it’s not just large employers that are striking out on their own. The percentage of employers who fully self-insure increased by 44% in 1999 to 63% in 2015. Self-insurance may give employers more control over benefit packages, and stop-loss protects them against uncapped liability.