The Pharmacy Benefit Management Institute (PBMI) began monitoring prescription costs and drug benefit plan designs in 1995. Each year the survey is modified to reflect the ongoing market dynamics. PBMI conducted this year's survey of U.S. employers in April and May of 2011. The survey was completed by 274 employers representing 5.2 million members.
2011 Key Findings
- The complexity of cost-sharing continues to increase, driven by increased use of four-tier plans and coinsurance designs (Figure 1). The percent of employers with fourtier plans grew to 25% in 2011, reflecting the growing use of specialty tiers. The percent of plans using coinsurance increased to 34%, up from just 14% in 2008.
- While copays for generics and traditional brands remained relatively flat, specialty copays increased by 37%. The average specialty copay grew from $61 to $84 in 2011 in an effort to keep pace with the rapidly increasing cost of specialty drugs.
- The copay differential between tiers continues to grow. The average differential between generics and preferred brands copays was $16 in 2011, compared to $7 in 2000. The average differential between preferred and nonpreferred brand copays was $20 in 2011, compared to $13 in 2000.
- Use of retail 90 continues to be high as nearly 60% of employers now cover 90-day supplies of maintenance medications at retail pharmacies.
- However, most plans are offering a greater copay discount for mail than for 90-day claims filled at retail. For example, the average ratio of mail to retail 30 copays for nonpreferred brands was 2.2 in 2011, compared to 2.5 for the ratio of retail 90 to retail 30 copays for nonpreferred brands (Figure 2).
- In contrast, specialty pharmacy networks are tightening. Thirty percent of respondents require that specialty medications be dispensed through their PBM's specialty pharmacy. Forty-eight percent use designated specialty pharmacies, up from 40% in 2010. Management of specialty drugs on the medical plan side continues to grow as 24% of employers now restrict coverage of specialty drugs on the medical side, up from 12% in 2010.
- The majority of respondents (54%) now exclude nonsedating antihistamines from coverage, likely reflecting the growing acceptance of OTC promotion as well as continued budget pressure in the slowed economy.
Implications
The growing complexity of plan designs, with a larger number of tiers and increased use of coinsurance, brings increased need for effective member education about cost-sharing. A positive trend in this area is the increased availability of online resources, which allow for determination of copays and therapeutic alternatives prior to the dispensing of a medication. However, many members will not access these tools before filling a prescription so other forms of member education are important in order to minimize member confusion and disruption and maximize savings opportunities for the member and the plan.
The demand for member support and education will continue to be most acute for users of specialty medications. With the addition of specialty tiers, the growth of limited specialty networks, and the tightening of benefit coverage for specialty medications, the need for benefit advocates to help navigate the growing complexity of the specialty benefit across medical and pharmacy is clear.
The extent to which differential copays between tiers and distribution channels are optimized requires ongoing monitoring by plan sponsors. The copay differential between tiers —generic, preferred and nonpreferred—are at an all-time high; and while differential copays can steer members towards more cost-effective alternatives, the impact on demand is not always clear. Plan sponsors must be careful not to set the copay differential so high that the copay loss exceeds the price savings.
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