Controlling Employer-Sponsored Health Plan Drug Costs

Employer-sponsored health plans continue to struggle with increased drug costs. Factors include increased utilization, new branded products, and inflation. Hospitals are not exempt and must implement new strategies to help control these costs.

UofL Health is a new, rapidly growing system with approximately 13,000 employees, including remote employees working in several states across the US. Due to the rising cost of medications for the employee health plan, the system shifted from a national pharmacy benefits manager (PBM) to an in-house program managed through a collaboration between human resources and pharmacy.

Working with a non-profit PBM partner, the organization has leveraged the pharmacy infrastructure and 340B program to develop a strategy to better control the escalating drug benefit cost. This strategy includes:

• Network of over 67,000 pharmacies across the US, including mail-order, to meet the needs of out-of-state employees or those who want the convenience of using a pharmacy close to their homes. • Employees are incentivized to use one of the   system’s retail pharmacies or mail-order services with reduced copays.

• Employees requiring specialty medications must be seen in one pharmacist-managed Medication Therapy Management (MTM) clinic and receive those medications from the UofL specialty pharmacy. The pharmacists use a collaborative care     agreement (CCA) with the system’s physicians and can also provide telehealth visits. Out-of-state employees or their dependents can schedule telehealth visits and receive specialty medications from a contracted specialty pharmacy. (The MTM   encounter qualifies the prescription for 340B pricing.)

• Diabetic employees and their dependents receive insulin, insulin pumps, lancets, and diabetic monitoring devices free of charge when followed by an MTM clinic pharmacist.

• Several maintenance medications are provided free of charge. However, certain high-cost weight loss medications require compliance with appreciative use criteria, prior authorization, and higher co-pays.

 • Pharmacy services also include curbside pickup at certain locations and pickup at one of the system’s inpatient or infusion pharmacies.

• Employees requiring specialty injections or infusions must use one of the system’s clinics or infusion centers.

• The system partnered to provide co-pay assistance and manufacturer-sponsored patient assistance programs for qualified employees.

One potential obstacle to overcome is for HR leaders to understand that 340B pricing is more beneficial than PBM rebates. Additionally, the organization must have or scale up to provide the necessary infrastructure to support the internal program (retail pharmacy locations, after-hours pickup kiosks, specialty pharmacy, registration of MTM clinics in the HRSA OPAIS database, clinical pharmacists trained to manage chronic disease states including diabetes, weight-loss, cardiovascular disease, and smoking cessation). Furthermore, the organization must communicate the program changes to the employees using multiple platforms, as the pharmacy team will become the resource for the new program. Therefore, hospitals or health systems of various sizes can develop a strategy and scale a similar program to achieve improved employee-patient outcomes and multimillion-dollar savings.