Payer and PBM benefit design evolves at a rapid pace with the introduction of new frameworks and drug launches. Creating a competitive pharmacy benefit and medical benefit infrastructure becomes an expensive challenge for health plans with ever-changing guidelines and new industry variables. Whether that variable is a new CMS mandate, an added JSON requirement, a new class of drugs or the shift to value-based coverage, the healthcare industry maintains a steady gaze on how health plans align their coverage models to developing trends.
Fortunately, recent guidelines, specifically in the managed care space, promote increased transparency to pharmacy benefit information. These mandates require health plans to make their formularies publicly available to consumers and physicians via comprehensive PDF guidebooks and drug searchable websites. However, dozens of new drugs enter the market each year in highly managed classes where complex coverage practices complicate the consumers’ ability to fully understand their plan. A recent Kaiser Health article illustrates the difficulties in making sense out of how drugs are covered (or not covered) under a plan’s medical benefit. Locating medical coverage information for these complex treatments, usually administered in a clinical environment, becomes a nearly impossible task on many health plan sites. According to some payers, the challenge here derives from the nuances in coverage for these treatments and the added complexity of multiple indications for a single product in many cases.
Today, most healthcare experts focus their attention on rising healthcare spending, potentially overlooking advancements in benefit design innovation and the positive shift to a more patient-centered strategy. Many healthcare stakeholders invest in provider-side initiatives, such as the creation of accountable care organizations, electronic health and bundled payments. However, payer efforts to redesign benefit structures and consumer implications also help to streamline the utilization of each healthcare dollar in play. Typically, insurers standardize the cost sharing tiers of their formularies to reduce operational costs. With this traditional structure, the clinical value of drugs and services does not play an influential role in the resulting payment model. Recently, many payers proactively partner with providers to develop a more effective cost-sharing and benefit design model to reduce the burden on consumers, while improving the quality of care.
But, what do changing benefit designs mean at the point of care? Recent insight into a specific class of products, treatments for opioid addiction, provides an interesting case study. Physicians and consumers advocate that CMS establishes a mandate for all federal health exchange plans to cover the set of medications leveraged for patients with opioid addictions. Primarily due to rising drug costs, existing benefit designs for a substantial segment of payers create barriers for these treatments via complex reimbursement restrictions. While this type of requirement provides clear value to affected patients and streamlines provider engagements at the point of care, health plans, PBMs and related agencies provide perspectives from the opposing viewpoint. They argue that this type of essential health benefit mandate could set a potentially dangerous precedent for other highly managed classes in the future. A mandatory call like this could upset the balance between affordability and coverage requirements, potentially resulting in an increase in premiums.
New benefit designs affect the entire healthcare network, from manufacturers to payers and providers to patients. In order for new benefit models to take hold, these shifts require support from multiple healthcare stakeholders. Time will tell as to how healthcare organizations will partner together to shape the benefit design framework of the future.