Compliance issues should guideyour decision on whether a drug or drug class or even all specialtydrugs should be excluded from your plan.

The cost of pharmaceuticals is forcing employers into abalancing act that's increasingly hard to maintain these days,making them straddle the line between compassion and their fiscaland legal responsibilities as high-cost drug claims continue tomount.

The pressure on drug costs has only intensified in recent yearswith specialty drugs that save or extend lives but carrybreathtakingly high price tags. Think Zolgenzma, which treats children with deadlyspinal muscular atrophy–at a cool $2.125 million. These drugs addto the burden of overall prices that are expected to rise6.3 percent annually over the next decade. Even before thespecialty drug phenomena, prescription costs have taken up afast-growing and outsized portion of total premiums, reaching16.5 percent by 2016 from 12.8 percent in 2012.

Related: 'Super spenders' accrued $2.1 billion in specialtydrugs costs last year

But high-cost drug claims are especially painful for employerswith self-funded plans. A single such claim can bust a well-plannedbudget, leading an increasing number to ask a question that'sneither unfair nor uncommon: "Do we have to cover thesemedications?"

If you're among them and thinking of amending your planaccordingly, enlist an expert to help you weigh alternativesolutions along with compliance implications. Here's what you needto know:

Potential solutions to high therapy and pharmaceutical claimscosts

The in-house course. It may take help fromoutside pharmacy and benefits advisors, but these costs can bereduced within the framework of your health plan and PharmacyBenefit Management (PBM) services.

What's required is improved coordination between the in-housespecialty pharmacy and the pharmaceutical manufacturers' assistanceprograms. These offer discounts or free products for qualifiedindividuals; tapping into them can reduce high-cost claims by asmuch as 100 percent. Keeping the prescription, caredelivery, patient history and claim coordination, within theestablished PBM solution and stop-loss accounting is best for thepatient and the plan.

Carve-outs of carve-outs. Such "innovator"solutions can work but they are inherently risky. They are newintermediaries in facilitating enrollment in the alternate fundingoptions including manufacturers' assistance programs, meeting adire need of patients and plans. But take care with them. Inaddition to concerns about their long-term viability, specialtynetwork discount guarantees and minimum rebate guarantees could beforfeited if larger PBMs do agree to work with them. Such offsetsmay be under-valued in their savings analyses. Plus, startups cansuffer growing pains, exhibited by inconsistent staffing andsupport, making a detailed evaluation of data exchange protocolsand patient privacy protections essential.

Don't run afoul of regulations

Compliance issues should also guide your decision on whether adrug or drug class or even all specialty drugs should be excludedfrom your plan. Chief concerns:

• Inclusion in any of the Affordable Care Act (ACA)preventive care lists. The ACA requires plans to covercertain screenings, procedures and drugs falling under theapplicable preventive classifications.
• Falling under an essential health benefit (EHB)category, as described by the ACA. EHBs are set in eachstate using a "State Benchmark Plan," which reflects the terms ofgroup medical coverage in that state. Self-funded and large groupemployers are not required to cover all the items or services(including individual drugs) that a State Benchmark Plan covers.
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  However, if they choose to cover the drug, they can't imposeannual or lifetime dollar limit. The basis for using the EHBdesignation for determining whether or not to exclude a drug/drugclass is complex, and shouldn't be undertaken without a complianceattorney's guidance.

• Issues of discrimination. Be wary ofcherry-picking your plan. Say you provide medical and surgicalbenefits and benefits for mental health and substance abuse, butexclude coverage for depression, this could lead to issues with theEqual Employment Opportunity Commission (EEOC) and under the MentalHealth Parity and Addiction Equity Act rules. A benefit has toapply to a broad group of employees and apply to multiple,dissimilar conditions, and at the same time not exclude individualswith or without a disability.
• Potential HIPAA issues, particularly if the exclusionis reactionary. An exclusion responding to a claim alreadybeing incurred could raise questions that Protected HealthInformation (PHI) had been used in the decision-making process.HIPAA provides that PHI can't be used or disclosed foremployment-related actions or decisions or in connection with otherbenefits or employee benefit plan of the employer.

For employers, it's all about balance today, and maintaining itwhen it comes to benefits and the miracles of modern medicine isonly going to get more difficult. You will have to step carefully,with the help of the right expert partners, to continue to meeteveryone's best interests.

Barbara Hawes is the national pharmacypractice Leader for HUB International. She is an accomplishedindustry leader with over 25 years of experience in thePharmaceutical/Employee Benefit Consulting business. CoryJorbin is the chief compliance officer for HubInternational's West Region Employee Benefits team. Cory consultswith employers of all sizes to design, implement and ensure thecompliance of employee benefit plans with the Affordable Care Act,ERISA, Internal Revenue Code, HIPAA, COBRA, FMLA, ADA and relatedmatters.

Read more: 

• Curbing specialty drug spending: Where tostart?
• Copay accumulator programs leave consumers on thehook for high drug costs
• Majority of Americans support current efforts tobring down drug prices