Radar on Drug Benefits
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Employers Shift More Drug Cost Control Efforts From PBMs to Medical Plans
In 2021, prescription drugs accounted for a median of 21% of large employers’ health care costs, and a full 100% of firms said they were concerned about prescription drug spending trends, according to the Business Group on Health’s 2023 Large Employers’ Health Care Strategy and Plan Design Survey.
Yet the rising cost of specialty medications — which are often covered by medical rather than pharmacy benefits — has forced companies to think differently about how to curtail drug spending, the organization found. According to the survey, specialty medications account for 56% of all pharmacy spending by polled employers.
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Part D Bid and Base Premium Will Drop in 2023; MA-PD Enrollment Surpasses PDP for the First Time in 2022
The monthly Medicare Part D base beneficiary premium for 2023 will be $32.74, a slight decrease from $33.37 in 2022, according to CMS. The Part D national average monthly bid amount continues to drop, from $38.18 in 2022 to $34.71 in 2023. Regional low-income premium subsidy amounts have increased over the past few years in most states, yet five states — New York, Illinois, New Jersey, Indiana and Kentucky — are projected to see a decline larger than 5% in 2022. South Carolina is projected to see the biggest jump, with its average subsidy amount going up from $31.12 in 2022 to $37.84.
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News Briefs: Medicare Negotiation Will Cost Pharma Manufacturers
Moody’s on Aug. 19 released a report “stating that the drug pricing provisions in the Inflation Reduction Act of 2022 are credit negative for the pharmaceuticals industry, as the savings to the federal government and consumers will generally be borne by the industry,” the credit rating firm said. The most substantial impact on drug manufacturers will come from the IRA’s Medicare provisions, which the report observes are “estimated to save the US government $102 billion over 10 years. This cost will fall largely to the industry, as will the price curbing provisions and the reduction in the beneficiary out-of-pocket costs.” Moody’s also expects pharma’s early-stage transaction trend to accelerate: “One implication of the Inflation Reduction Act will be an increase in industry-wide acquisitions, as companies will seek ways to improve longer-term growth rates, given pressure on earnings growth that will result from the legislation. By acquiring companies with promising pipeline-stage products, pharmaceutical companies can increase the number of future drug launches to drive higher earnings.”
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Congress Won’t Act on Insulin Prices for Commercial Market
Although Congress is on the brink of passing a landmark prescription drug price reform bill as part of the Inflation Reduction Act (IRA) — Democratic leadership in the House of Representatives plans to vote on the bill Friday — the legislation will not include any provisions that impose price controls on insulin sold to patients with commercial insurance. D.C. insiders tell AIS Health, a division of MMIT, that they do not expect separate, standalone legislation to make it through Congress any time soon, which shines a spotlight on new insulin benefits announced by major carriers like UnitedHealth Group.
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CivicaScript Launches Initial Generic Drug, Plans Several More in Coming Years
CivicaScript last week began selling its initial generic drug, a 250 mg abiraterone acetate tablet. It’s the first of what the health insurer- and PBM-backed nonprofit company hopes are many medications that it will produce to help patients and payers lower their drug spending.
The product is currently only available through Intermountain Healthcare, a Utah-based integrated health plan and system that owns a specialty pharmacy, and Lumicera Health Services, a specialty pharmacy owned by Navitus Health Solutions. But CivicaScript President Gina Guinasso tells AIS Health, a division of MMIT, that she expects other pharmacies to offer the medication in the coming months.
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