Prescription drugs are an increasingly
essential component of health care
today. By properly using these medications to prevent and treat illnesses and
— in some cases — help individuals avoid
more costly medical expenses, these remedies have established a permanent place in
our discussion about better health.
Watching a television show or reading a
popular magazine only illustrates this fact,
as advertisements for different prescription medications are abundant.
Despite their prevalence and usefulness,
there are major issues that both employers
and consumers face when dealing with
prescriptions drugs, including cost.
“Pharmacy benefits are clearly one of the
most important parts of an overall health
benefits strategy,” says Bill Berenson, vice
president of sales and service for Aetna’s
Small & Middle Market Business in the
North Central Region. “This is an aspect of
health care that affects the majority of
employees — their personal health as well
as their finances — and also accounts for
a large share of health care costs for
employers.”
Smart Business spoke with Berenson,
who described several ways that employers could reduce their overall pharmacy
costs and also pass some of these savings
onto their employees.
What are some simple ways for a company to
reduce pharmacy costs?
One of the most common methods
employers use to reduce pharmacy expenses is to adopt a tiered formulary for
prescriptions in their plan. With this approach, employees pay less for their prescriptions when they select a generic drug.
If they prefer name brands, they save
money by choosing from a list of approved
formulary prescription products. The employee pays the most for brand-name drugs
that are not on the formulary list.
What is the most effective way for employees
to receive their prescription drugs?
Many employers overlook a very powerful tool in managing their pharmacy costs:
a mail-order program. For self-funded
plans and many insured plans, these programs often allow employees to buy larger
quantities of certain drugs for chronic conditions through the mail with a lower relative co-payment.
The mail-order provider is able to buy discounted medications in bulk from manufacturers and pass these savings on to
employees. Employers see savings through
reduced overall pharmacy claim costs. In
addition, many insurers are now offering
their own mail-order programs, which
make adding this option simpler and more
efficient.
Are there any aspects of ‘consumer-directed’
health plans that can help with pharmacy
costs?
In response to rising drug costs, many
employers are adopting aspects of consumerism in their pharmacy plans. These
features are designed to preserve employee choice while providing information and
incentives to reduce unnecessary costs.
This includes plans that are compatible with health savings accounts (HSAs),
which can help members defray some
pharmacy costs through tax savings.
What are ‘specialty’ drugs?
Specialty drugs — treatments for such
conditions as cancer, hemophilia, hepatitis,
immune deficiency, infertility, multiple
sclerosis and pulmonary diseases — are a
very costly and growing subsegment of
many employers’ pharmacy expenses.
These drugs often are injected and require
special handling and administration.
Are there ways to lessen the financial impact
of these types of drugs?
One way health plans are helping to
reduce the cost is by offering specialty
pharmacy services that provide these
drugs less expensively through advantageous vendor contracts.
In addition, some specialty pharmacy
service providers may offer around-the-clock counseling operations — staffed by
care coordinators, pharmacists and registered nurses — to support employees with
disease-specific treatment programs. This
kind of responsive service could help
improve the employee’s overall health and,
as a result, reduce unnecessary claim
expenses for the employer.
By implementing some of these different
approaches — as well as offering plan
designs that provide useful information
and incentives to employees for making
cost-effective decisions — employers can
reduce their costs associated with pharmacy benefits and prescription drugs,
while at the same time helping to maintain
the health and productivity of their work
force.
BILL BERENSON is vice president of sales and service for
Aetna’s Small & Middle Market Business in the North Central
Region. Reach him at (312) 928-3323 or [email protected].