Sputtering Cost Reforms May Gain Momentum in 2020, but Patients Will Still Carry Higher Burden

Despite much talk about lowering drug prices, there has been limited action, Karina Abdallah, PharmD, clinical operations manager for Blue Cross Blue Shield of Michigan, said Wednesday at the 2020 Specialty Therapies and Biosimilars Congress in Miami, Florida.

“Everyone really does have best interests at heart in terms of reducing the total costs of care, but we haven’t found that magic solution yet. But it is likely to happen due to the Trump administration’s big push for drug transparency and big changes,” she said, adding that economics of healthcare will inevitably force beneficiaries to shop for healthcare more carefully.

In a wide-ranging state-of-the-industry talk, Abdallah discussed pending legislation, electronic prior authorization (ePA), and biosimilar uptake, among other prominent issues.

The FDA has introduced draft guidance to facilitate the development of safe and affordable insulin products, including products that are biosimilar to currently marketed insulin products, and how this initiative evolves is worth watching closely this year, Abdallah said.

Several proposed changes that could happen, she said, include limitations on utilization management, such as step therapy and prior authorization; reform of Part D to cap out-of-pocket (OOP) costs; and potential spreading of OOP costs throughout the benefit year to ease spikes in patients’ responsibility these costs.

“That’s really a positive thing in terms of reform, and we’re looking forward to seeing changes on that,” Abdallah said, noting that many patients on fixed incomes struggle with benefit gaps.

Any movement on a proposed International Price Index for Part B drugs is not likely soon, she said.

There’s been a lot of talk about insulin-specific rules or legislation to bring down costs, and that’s something that could very well lead to a concrete initiative in the next few years, she added.

On the issue of curtailing direct and indirect remuneration fees collected by pharmacy benefit managers and passing these funds on to beneficiaries, Abdallah said, “there have been a lot of layers here and we’re really looking to see if any changes do occur.”

In the category of measures that are unlikely to happen, she placed proposed legislation that would cap drug price increases to the rate of inflation. Similarly, it is unlikely that Medicare will be allowed to negotiate drug prices, she said.

The Trump administration signed the SUPPORT for Patients and Communities Act, which provides for the use of electronic prescribing, which is expected to reduce prescription abuse, and ePA for Medicare, both slated to become effective in 2021.

Rising costs are going to be passed along to consumers more and more, Abdallah said. Trump administration efforts to put drug pricing information in the hands of consumers, partly by forcing hospitals to disclose what they charge for treatment, will usher this movement in a positive direction, she said.

Payers are moving with web-based prior authorization tools, she said. These have multiple advantages. They’re fast, they allow real-time status checks on requests, and immediate approvals can be granted for patients who meet criteria. They make the manual form-filling and faxing process a thing of the past. Even questions asked can be streamlined.

“From now on we can focus on the clinical items that matter and move into it fairly quickly,” she said.

ePA also has enabled provider engagement and made it easier to identify high utilizers of drugs requiring prior authorization and identify alternatives to high-cost drugs, she said.

Prior authorization doesn’t need to be applied across the board, she said, and automatic ePA for requests that meet criteria can serve as an incentive to get providers to work with these systems, Abdallah said.

Offering her perspective on payer policies with respect to putting biosimilars on formulary, Abdallah said the choice of which of 2 or more biosimilars to include will be very largely influenced by lowest price. “It’s going to be the magic number where there’s a [biosimilar] that’s going to be palatable.”

Biosimilar acceptance in the provider community remains an issue, however. Physicians will tend to want heavy reassurance that a biosimilar is equivalent to an original drug. “They want those clinical trials. They want post-market studies. They want crossover studies. They want all of that before they’ll make a switch. But what I’m seeing now is that even with that information or the lack of that information, if the payer and the health system make a decision, then providers will align with that.”

As far as patient acceptance goes, biosimilars are not really on their radar of concerns unless they happen to have chronic conditions that have made them familiar with multiple treatments, she said. “Anything that’s a chronic disease that they have kept at bay after trying several products, that population is going to be really sensitive to a change.”

Employers, on the other hand, are tuned in to biosimilars, and Abdallah said she’s had many discussions with them on the issue. Being from Michigan, she’s worked with auto unions, which have had to contend with declining benefits, and being forced to accept generics and biosimilars is a sensitive issue with them, although something of an inevitability, given the economics of life in the auto industry, she said.