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Mercer

With all the uncertainties around healthcare legislation swirling, cost control of pharmacy spend remains top priority for employers. On one hand, employers obviously want their employees to have access to the medications they need: drugs like insulin, blood pressure treatments, and cholesterol blockers have long played a critical role in employees’ health. But now new specialty biotech drugs – some of them true medical breakthroughs – are flooding into the market, at costs much higher than previous therapies. Drug prices spiked by 9.8% between May 2015 and May 2016, and there are more sharp increases ahead. Drug costs are quickly becoming unsustainable, for both employers and, increasingly, plan members. Many high-cost brand name drugs may have rebates to reduce their net cost, but the member or patient typically does not see these rebates so their out-of-pocket cost is still high. And even the cost of some generic drugs has risen dramatically.

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Check out this article for tips on managing out-of-pocket expenses in a high-deductible health plan. Typically, your paycheck deductions are lower, which is a bonus, but how do you keep from falling behind financially when you need care? Here are the author’s suggestions, plus a few from me.

  • Take advantage of preventive services covered at 100%. For example, get a flu shot so you are less likely to get sick.
  • Use in-network providers for the lowest possible out-of-pocket expense.
  • Consult with a nurse for free by calling the nurse-line for a consultation before scheduling an appointment with a physician; it could save you the cost of an office visit
  • Many plans include a telemedicine benefit. The cost of a telemedicine visit is usually around $40-$50, and can be scheduled at your convenience via phone or video chat.
  • Investigate "convenience care” clinics in your area. Located in stores like Target, CVS, and Walgreens, they offer a limited number of services at a lower cost than urgent care or a physician office visit.  
  • When your doctor recommends a prescription drug, ask how much it costs and if there is an over-the-counter or generic option. Check a few different pharmacies for the best price. 
  • If a prescribed drug is very expensive and you have not used it before, ask whether you could have a smaller number of pills at first to be sure it works. Check to see if there are patient assistance programs to help defray the cost.
  • Shop around for services and tests. A variety of tools exist to support comparison shopping; check with your insurance company for help.
  • Some employers offer indemnity coverage -- policies that will pay a set dollar amount when you have an accident or are hospitalized. These low-cost coverages can provide peace of mind for those concerned about covering expenses before they meet their health plan’s high deductible.
  • If you’ve moved to the high-deductible plan from a more expensive plan, take the savings from lower paycheck deductions and deposit them (tax-free!) in a health savings account. That way you will have some money set aside to help pay for care before you meet the deductible. Many employers will help fund your HSA.  
  • Take advantage of any opportunities to earn dollars for your HSA by participating in healthy activities like biometric screenings. 

These are good suggestions to communicate to employees and their families. Even if you have provided similar guidance in the past, everyone can always use a refresher.

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With this post, we at the blog are officially kicking off annual planning for 2018. Over the coming weeks, we’ll be offering advice and check lists for 2018, including some special to-do’s for prescription drugs and time-off benefits. We thought a good place to start this year is with a list of best practices. The list below contains 25 health benefit best practices from the Mercer National Survey of Employer-Sponsored Health Plans. Each year we compare the performance of employers that use the most of these best practices with those using the fewest (the top and bottom quartiles). And each year we find that those using the most best practices have lower average healthcare cost increases. (In 2016, the two groups had average increases of 3.8% and 4.8%, respectively.)

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As the latest Mercer National Survey of Employer-Sponsored Health Plans shows, more employers are offering employees tools to make more informed healthcare decisions. Among the largest employers (those with 20,000 or more employees), 28% provided transparency tools through a specialty vendor in 2016, up from just 15% two years ago. An additional 62% say their health plan provides some type of transparency tool. 

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The Kaiser Family Foundation recently polled Americans to identify their health care priorities for the next President and Congress. At the top of the list were issues related to prescription drug costs – specifically, making sure drugs to treat chronic conditions are affordable for consumers (74%) and government action to lower drug prices (63%). From an employer’s perspective, the latter is more important, as it would manage the total cost of the drug rather than simply limiting a member's out-of-pocket expense, which just shifts cost back to the plan. While drug prices will be a hot topic for lawmakers and the regulators to address when new leaders take office in January, employers might not want to wait and hope. Over the next five years, it is expected that 40 new specialty drugs will hit the market each year. Now is the time to develop a strategy to get in front of that influx of new high-cost drugs.

 

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