Only 14 percent of participants indicated that none of the increased costs will be passed along to employees.
- Approximately half of all respondents say their company would plan on passing 50 percent or less of the increased premium cost to employees.
- Three percent plan to pass along up to 75 percent of the increased cost while one percent will pass along all of the increased costs.
Overall, it appears that co-pays are increasing. What is concerning about the trend is that it can be a shortsighted solution: Not only does it place a greater burden on employees but it does nothing to affect industry pricing or appropriate utilization.
The survey also found that co-pays are cited as one of the primary barriers to the proliferation of mail-order services. Many mail-order pharmacies charge 2 to 2.5 times the co-pay amount for a 90-day prescription, which is still a savings to both the employer and the member.
Paying a premium allows those who need care to get it, while giving pharmacists a greater financial incentive to provide a higher quality of care. Indeed, better patient care is needed more than ever, as the number of employees requiring care has grown steadily in recent years as employees reach their primary healthcare years.
In order to have an impact on prescription drug pricing and benefit costs, employers need to scrutinize their programs and the costs associated with the benefit they are providing.
The rise in the number of employees requiring pharmaceutical coverage affects businesses indirectly as well. The aging of the workforce, the national obesity epidemic and other health conditions are driving up the costs of research and development for new drugs, cited as one of the primary factors responsible for skyrocketing costs by survey respondents.
Survey Solutions
To change the tide of rising costs and promote better employee care, the 2006 Arxcel Prescription Benefit Research Survey provides several suggestions for employers to encourage their workers to be more discerning healthcare consumers. The recommendations are geared toward implementing plans that allow for greater clinical oversight to encourage employees to become more educated healthcare consumers.
One step in this direction would be to “carve-out” prescription benefit plans from overall health coverage to allow for greater access to data and lowered costs.
Mail-order services also is an effective means of lowering costs while providing increased clinical oversight. Mail-order services allow pharmacists to spend more time reviewing an individual’s medical history. Additionally, unlike most pharmacies, mail-order providers separate specific treatment areas into teams of specialists, allowing them to ensure that the proper dosages are prescribed based on an individual’s condition and medical history.
Another cost saving measure is adopting coverage plans that favor step-therapy programs, in which the patient is started on the most efficient and cost-effective medication to treat his or her condition before automatically prescribing brand name drugs first. Step-therapy programs have a positive impact on cost, with an average savings of four to six percent of employees’ total prescription costs.
Finally, employers can move to a percentage co-pay instead of a flat dollar co-pay. This alternative keeps pace with inflation and fosters better consumers who are more likely to view their options if they are paying a percentage of costs.
Complete results of the Arxcel Prescription Benefit Research Survey are currently available online. We hope that the insights provided in this fifth-annual survey will help you make better decisions about delivering the best program for your business and its members.
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