2018 started offfull of high expectations for how health care costs and deliverywould be revolutionized, but it ended up being a fairlyunremarkable year. Among other things, we saw the federalgovernment honing in on reducing pharmaceutical spending, from theWhite House proposing an elaborate drug pricing strategy to CMSunveiling new drug payment programs, and even pharmaceuticalmanufacturers promising to slow (or stop) price hikes. Yet,according to an analysis by Associated Press there were 96 drug priceincreases for every one price decrease from the start of 2018through July. Furthermore, immediately after President Trumpannounced in July that pharmaceutical manufacturers would slashprices, the list prices of 395 drugs rose.

As brokers and their clients start planning for the coming year,one of the biggest areas that benefit managers and advisors will betargeting to rein in costs is pharmaceutical spend. Especially inlight of 2018, many will rely less on health care policy and willinstead take matters into their own hands to move the needle onannual pharma spend, which is the number one driver in health care costs. Nowthat the pre-holiday, end-of-year push is over, benefitsdepartments around the country are using Q4 and Q1 to take aproactive look at their strategy and goals for the next fewyears.

Looking ahead to 2019 and 2020, most benefit professionalsshould assume drug prices will continue to increase and that theeconomy will slow down with potential recessionary changes, so theywill need to remain as competitive as possible with their benefitplans. To address these challenges, many will look beyond thestatus quo to find new levers to pull to control pharma benefitcosts, while maintaining as many options for employees as possible.Instead of rolling out numerous new initiatives all at once, agrowing trend is ongoing innovation — experimenting with just oneor two new services or products each year in order to evolve withthe changing political, economic and health care landscapes.Continuous and incremental innovation will continue to emerge asthe best path for reducing pharma costs while maintaining, orimproving, employee satisfaction.

Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.

  • Critical BenefitsPRO information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
  • Exclusive discounts on ALM, BenefitsPRO magazine and BenefitsPRO.com events
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.