As longevity increases and chronic diseases become more prevalent in Canada, companies are seeing a rise in the number of high-cost claimants. Different employers discussed the cost-cutting measures they’ve introduced in response to this rise during the 11th annual Group Insurance and Pharmaceutical Committee event in Toronto on Wednesday.

Telus
The telecom company first started talking about its ballooning healthcare costs in 2004, said Carol Craig, director of HR at Telus. “Our healthcare costs had doubled from 2001 to 2011, and it had gotten the attention of our senior leadership. So we knew we had to do something.”

After analyzing its drug plan spend, the company changed its plan design, incorporating new features such as mandatory generic substation. Additionally, Craig said, Telus introduced a $9 dispensing fee cap and comprehensive prior authorization protocols for specialty drugs, which make up the majority of the company’s prior authorization drug costs.

“We knew we had to have a very comprehensive communication strategy” to spread the word about these changes, Craig said. “We were trying to avoid team members first learning about the changes when they were at the pharmacy.” The company’s communication strategies included sharing a video about the drug plan changes, sending information directly to members and holding face-to-face sessions.

Mainstay Insurance Brokerage Inc.
Unlike bigger companies, smaller businesses can be more reluctant about plan design changes, said David Patriarche, owner of Mainstay Insurance Brokerage Inc., which provides employee benefits to small and mid-size enterprises in the Greater Toronto Area.

“Small business clients tend to wait until rising costs start to hit them,” Patriarche said. “Many of [my] clients don’t want to risk upsetting members by making changes” because they don’t know what the effect of the changes will be. For example, Patriarche said, introducing drug caps means potentially excluding a drug that is currently covered by the Trillium Drug Program (TDP), a government initiative that helps Ontarians who have high prescription costs relative to their household income; however, the drug may not be covered by TDP in the future.

As a result, many of Patriarche’s clients do not have drug caps. “They still are paternalistic; they want to provide coverage.” Similarly, he said, only some of his clients have switched to mandatory generic substation, and very few have added restrictive formularies.

He said his clients’ overall costs have been relatively flat over the past few years, which has been another disincentive to change.

The Arthritis Society
Part of The Arthritis Society’s response as an employer to high-cost claims has been to ensure that employees have access to prescribed medication. “There are no substitutions for these specialty drugs,” explained Janet Yale, CEO of The Arthritis Society. Also, employees can get their drugs from their local pharmacy, even if it’s more expensive than a non-local one, in order to accommodate individuals with mobility issues, Yale added.

But she noted that addressing high-cost claims shouldn’t be limited to the realm of medications. “Two-thirds of the costs associated with arthritis are the productivity [loss] costs, not drug costs,” she said. Canada has 4.6 million people who live with arthritis, and 60% of those people are of working age, Yale added.

Working with pain, being unable to return to work early and dealing with flare-ups are all factors that affect the productivity of employees with arthritis, Yale explained.

That is why The Arthritis Society has also launched measures such as telecommuting and flexible schedules. “[It takes] people with arthritis a bit longer to get going in the morning,” she said.

Wellness initiatives
Apart from making drug plan changes and offering accommodations for high-cost claimants, it also helps to introduce targeted wellness programs, said David Willows, vice-president of strategic market solutions with Green Shield Canada.

“The options are multiple. Many organizations do it. What’s been missing is the hard work on the analysis side,” Willows said. “A lot of initiatives have not been based on a deep dive in data.” It’s crucial to know which plan members have diseases, what those diseases are, what kind of wellness programs would work best for them and what these programs aim to do, he explained.

Craig echoed that sentiment, noting that when an employer sets up a gym, for example, it’s usually the fit people who visit, leaving the employees that need more help out of reach.

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See all comments Recent Comments

D Hunter:

If you are near a COSTCO they always have the lowest dispensing fee and the lowest mark up on pharmaceuticals. And you don;’t have to be a member- they can’t/ wont deny service – it’s against the law!

Wednesday, April 16 at 2:49 pm | Reply

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