As we have observed countless times, specialty drugs are very rapidly becoming the majority of prescription spending and therefore are the focus of intense management attention. The Pharmacy Benefit Management Institute puts out a regular report summarizing trends, identified via survey of 366 companies with at least 1000 health insurance plan enrollees, in the employer-based health insurance market regarding these medications. (PBMI Report) The two sides of specialty compounds are well-known. On the one hand they all tend to be expensive, both for insurers and for patients. On the other, they can offer dramatic improvements in treatment, as the hepatitis C drugs do. Many, however, are only marginally more beneficial than existing approaches. 50% of respondents to the PBMI survey said specialty medications were one of their top two health care concerns, but they only spend 20% of their time on the topic, despite the medications rapid move toward being 50% of drug spending. Companies have a much higher awareness of specialty spending than they did even a few years ago, with increased reporting coming from specialized health care analytics firms, while PBMs and health plans continue to be the most significant sources of information.
28% of firms said specialty costs rose more than 20% in 2014, while another 39% said it increased by 11% to 20%. Trends are slightly higher for the pharmacy benefit drugs than those covered on the medical side. The primary strategies being used to manage the problem are 86% using prior authorization under the pharmacy benefit and 72% for specialty compounds covered under the medical benefit; 76% using clinical drug management programs for the pharmacy benefit and 61% for the medical benefit; and step therapy by 68% under the pharmacy benefit and 51% under the medical benefit. Management via these techniques on the medical benefit side continues to rise while that on the pharmacy benefit has plateaued. 62% used a separate cost-sharing tier and many use high copays and a significant minority use coinsurance for specialty drugs. The report contains a very dense amount of detailed information on plan designs and management techniques.