From drug pooling to medical marijuana, plan sponsors have a number of issues to keep track of when it comes to their benefits plans. At the Face to Face Drug Plan Management forum in Vancouver this month, a panel of experts tackled some of the hot topics the industry is thinking about.
Pooling: One concern for sponsors and advisors is that pooling charges are increasing at a much faster pace than premiums.
“I don’t think drug plan design and what we’re doing on the insurance side has kept up with drug innovation,” said Meghan Vallis, senior vice-president for consulting at Apri Insurance Services Inc. When drug prices soared over the last couple of years, a lot of plans didn’t have protections, such as prior authorization, in place, she noted. “Afterwards, we saw triple increases to pooling charges with no consistency and no transparency around how the charges were calculated. Insurers are using the same mechanisms for small and large groups, and it doesn’t make sense.”
Mark Rolnick, vice-president, payor partnerships and plan sponsor innovation at Shoppers Drug Mart Inc., said the challenges with pooling aren’t surprising since drug manufacturers have shifted the focus to meeting unmet medical needs with innovative drugs that often have bigger price tags. “What does surprise me is that with the pooling challenges of today, more sponsors haven’t yet opted more for actively managed plans that can help employers and their employees make trade-offs on traditional drug therapies for which there are many treatment options. There is a great opportunity for pharmacists to support such plan design changes, too, which is exciting.”
Kevin O’Connor, director of federal and private health care at Janssen Inc., offered two suggestions to control drug spending. First, rather than having open formularies, insurers and plan sponsors should, he said, “put special authorizations in place to ensure the cascade of drugs from lesser to higher costing is utilized. For the second part, I recommend private insurers invest in negotiating drug prices.”
Forecasting of new drugs: A few years ago, new treatments for hepatitis C took plan sponsors by surprise and caused a significant spike in drug costs. As a result, insurers and drug plan sponsors are more aware of the need for better forecasting of the cost impact of new therapies.
“As a pharmaceutical manufacturer, I think we’re pretty good at forecasting new medications coming to market and what the future indications may be,” said O’Connor.
“We know the demographics down to the granularity of age bands and gender. Our forecasts on hep C were pretty accurate. However, some people may be skeptical of our forecasts because we are the manufacturer. Innovative Medicines Canada does an annual aggregate forecast on the market. I would recommend that industry associations, Canadian Life and Health Insurance Association and IMC take this on, setting up standards and rigour so that what is available from the manufacturer could be passed on with confidence to the insurers.”
Biosimilars: The launch of biosimilars –– products that are similar but not identical to biologic originator products –– seem to offer drug plan sponsors some cost relief. Panellists at the Vancouver event discussed the key issues that plan sponsors need to be aware of with biosimilars.
“The introduction of biosimilars can present some savings opportunities for plan sponsors, insurers and potentially for patients,” said Rolnick.
“While product listing agreements, where the negotiated price for originator biologics approximates the price of biosimilars, can add neutrality from a cost perspective and are becoming more common, they do risk future savings from biosimilars as they may never get used. If there is no biosimilar market, there may be no future PLAs on originator biologics. That’s something to be mindful of.”
Gail Attara, chief executive officer of the Gastrointestinal Society, stressed that biosimilars aren’t like generic versions of brand drugs, as they’re are similar but not identical to the original biologic. “Health Canada states that an approved biosimilar for a reference originator biologic is safe, effective, of quality and should produce a similar effect, but it is a standalone drug,” she said.
“They are ideal for patients newly prescribed biologics. However, I encourage drug plan managers to recognize that these drugs are not interchangeable and to not force patients on a biologic to switch to a biosimilar. A strong body of evidence shows that switching medication can result in treatment failure.”
Medical marijuana: With the impending legalization of recreational marijuana in Canada, insurers and plan sponsors need to consider what they can do to manage the issue in the workplace. So far, there are many unresolved questions.
“Insurance carriers need to get up to date with how cannabis is consumed,” said Vallis.
“There are oils, tinctures, vaping, eating it in candy, cookies and whatever. Are people going to be rated with a smokers’ rating on insurance or denied disability because they are literally doing a droplet of a form of cannabis? Should you be considered a smoker if you vape three times a week? On the medical side, carriers like Green Shield and Sun Life include cannabis in their health plan, and I’m sure other carriers will follow suit. You can also have it covered in health spending accounts. But we need to understand what conditions have evidence, what conditions should be included, should medical cannabis require prior authorization and what are the maximums.”
Rolnick noted legalization of recreational marijuana could help remove the stigma associated with use and encourages more people to talk to their physician about medical cannabis as a therapy for a condition they have.
“Once they try it and see positive, therapeutic results, we believe there will be more people coming back to their employers to ask for medical cannabis coverage. Plan sponsors and advisors should be thinking about their overall policies in this space right now. The biggest gap we see today on the medical side is that there isn’t a good support and advice system for plan members with a prescription for medical cannabis. We think there is an opportunity for pharmacy to be part of the conversation, given that cannabis is a drug with side-effects and interactions and who better to counsel plan members on medications than experts in the field?”
Read more coverage from the 2018 Face to Face Drug Plan Management forum Vancouver.