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Private drug plans saw the largest yearly increase in their average eligible costs in 2019, according to Telus Health’s annual drug trends report.

The report attributed the rise to a jump in the use and cost of specialty drugs and a growth in younger Canadians using medication for mental-health challenges. It also noted the repeal of the OHIP+ program in Ontario and an increase in overall costs for traditional drugs also contributed to the 7.6 per cent spike in private plans’ eligible monthly costs across all plan members. This is well up from a decline of 3.6 per cent in 2018.

Provincially, Ontario saw the highest spike in eligible costs at 10.2 per cent, largely attributed to the OHIP+ rollback — but, Telus Health noted, when it removed costs for plan members under age 25, eligible costs in the province had still increased 5.4 per cent, compared to a 2.4 per cent drop in 2018. Quebec saw cost increases of 5.8 per cent (up from a three per cent increase in 2018), followed by the Atlantic provinces (4.2 per cent, up from a 1.1 per cent decrease in 2018) and western provinces (four per cent, up from a 0.3 per cent drop in 2018).

Read: Specialty drug usage, traditional drug costs drive small rise in 2019 spending: report

The report also found the average eligible cost per claim for all plan members up to age 64 was $74.78 in 2019, up three per cent from 2018 ($72.59) and 8.4 per cent from 2015 ($68.97). Claimants’ total average eligible costs in 2019 were $769.13, up 3.2 per cent from 2018 ($745.54) and 13.8 per cent from 2015 ($675.95). The number of claims per claimant has also been slowly climbing to hit 10.3 in 2019, the same as 2018 and up from 9.8 in 2015.

By age group, the highest eligible drug cost increases came from younger members — plan sponsors saw a 27.9 per cent increase for those under age 25 (attributed to OHIP+ changes in Ontario) and an 11.6 per cent increase for those between ages 25 to 29, the latter due to an increase in mental health-related drug claims.

“We are seeing more mental health-related claims, as well as claims for attention deficit hyperactivity disorder, in this age cohort,” said Jason Kennedy, director of health business consulting at Telus Health, in the report. “Awareness of mental health has grown over the past decade and feelings of stigma are greatly reduced. Unlike previous generations, younger people today are less likely to think they are invincible and more likely to recognize they need help.”

Indeed, drugs to treat depression represented the highest number of mental-health drug claims, the report noted. Looking at the top 10 drug categories by eligible cost, depression ranked fifth, representing 5.1 per cent of plan sponsors’ eligible costs and 9.5 per cent of total claims in 2019.

Read: Global sales of mental-health drugs could hit US$40B by 2025 due to coronavirus

“There are lessons here for all of us as we look to the future,” said Laura Mensch, vice-president of health benefits management at Telus Health, in the report. “Physical distancing, self-isolation and working from home have dominated so much of our behaviour and all indications are that it will certainly contribute to even greater mental-health challenges in the months and years ahead.”

Telus pointed to the breakdown between specialty and traditional drugs as a strong indicator for the cost increases seen by plan sponsors in 2019. While eligible costs for traditional drugs have declined or stayed flat over the last 10 years due to patent expiries and legislated generic drug price reductions, helping to offset the high cost and growing use of specialty drugs, eligible monthly costs per insured for traditional drugs grew in 2019 by 2.9 per cent.

As well, the average eligible monthly cost per plan members aged 25 to 64 for specialty drugs increased by 10.1 per cent, compared to an increase of 2.9 per cent for traditional drugs. While the average cost per claim for specialty drugs grew by 2.1 per cent in 2019, the growth in utilization was 7.8 per cent.

“The growth in specialty drugs is really coming from utilization,” said Shawn O’Brien, principal for data enablement and drug, health and dental product roadmap at Telus Health, in the report. “We are seeing more specialty drugs coming to market, some treating previously untreatable diseases, resulting in more opportunity for treatment with these drugs.”

Read: Growing use of specialty drugs putting pressure on plan sponsors: report

According to the report, specialty drugs’ share of eligible costs more than doubled in the past 10 years, from 14 per cent in 2010 to 30 per cent in 2019, while the number of claimants has stayed consistent, at around one per cent.

Specialty drugs also dominated in two of the top five drug categories by eligible cost. They represented 99 per cent of eligible treatment costs for rheumatoid arthritis (the top drug category, which accounted for 12.1 per cent of private plans’ total eligible costs) and 54 per cent of eligible costs for skin disorders (the third drug category by eligible cost), which represented 6.9 per cent of total eligible costs. They also represented 79 per cent of eligible costs for cancer treatments in 2019.

However, the report noted British Columbia’s mandatory switching policy for certain biologic drugs is having a positive impact for private plan sponsors. Telus Health looked at the number of private plan members who submitted claims for an inflammatory disease biologic and biosimilar in the six months before and after B.C.’s May 2019 launch of the first phase of the program. Between December 2018 and May 2019, 99 new patients submitted claims for a reference biologic while 100 submitted for the biosimilar; from June to December 2019, claims for biosimilars more than doubled to 227, while just 113 claims for a reference biologic were submitted.

Read: B.C. government says expanding biosimilars will save nearly $100 million over three years

The report also found the use of generic drugs is on the rise, representing 63 per cent of prescriptions filled in 2019, up from 62 per cent in 2018 and 58 per cent in 2015. This trend is being driven by mandatory generic substitution policies: 56 per cent of private drug plans had these policies in place in 2019, up from 53 per cent in 2018 and 43 per cent in 2015. One-third (31 per cent) of plans had a regular generic substitution policy, where a doctor can override the substitution. Combining mandatory and regular substitution policies, 87 per cent of plan members were covered by a plan with a generic drug policy in 2019.

Copyright © 2020 Transcontinental Media G.P. Originally published on benefitscanada.com

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