The pandemic has shone a light on new areas of pharmacy benefit management where benefits professionals and PBMs can not only cut costs, but also make a tremendous impact on employee health.
It's been a year of disruption and unpredictability for benefits professionals, and the long-term financial impact of the pandemic on employer costs has yet to be determined. With many plan sponsors grappling with what the future will look like and how to lower costs while improving employee health and access to care, pharmacy benefits in particular will be put under the microscope.
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Employers are feeling the pressure to cut costs and gain greater control over their pharmacy spend due to economic constraints and shrinking budgets as the year wraps up. While organizations will continue to invest in pharmacy benefit management (PBM) partners to achieve cost savings, a few key areas of pharmacy benefits will drive significant impact in 2021. Here are four trends benefits professionals should watch for in the year ahead:
1. Digital therapeutics to change member behavior
While there has been growing interest in digital health over the last few years, the COVID-19 pandemic has accelerated its adoption. In fact, digital health is one of the few industries to have grown during the pandemic, with companies receiving $6.3 billion in funding in the first half of 2020, a 24% increase over 2019.
One area of digital health, fueled by consumer demand that will be a top priority among plan sponsors in 2021, is the increased use of evidence-based digital therapeutic programs to treat chronic conditions. Providing proven software, apps and other digital technologies to help individuals manage and treat a broad spectrum of conditions will no longer be a nice-to-have, but is fundamental in changing behavior to improve employee health outcomes. Offering digital therapeutic programs, backed by rigorous clinical evidence and approved by regulatory bodies, can lead to fewer complications or hospitalizations and reduced health care costs for both the employee and the plan sponsor.
2. Improved medication adherence
Financial concerns and fear of in-person health care visits throughout the pandemic have increased medication non-adherence, which is when patients fail to take their prescriptions as prescribed. According to the U.S. Food & Drug Administration, medication is not taken as prescribed 50% of the time. As a result, it is estimated that non-adherence to medication leads to $100-$290 billion in direct and indirect costs annually. These costs are especially high among patients with chronic conditions who may experience complications that lead to emergency room visits or hospital stays.
Plan sponsors will seek opportunities to promote the value of adherence to improve their employees' health and create cost savings. In particular, benefits professionals should seek to find pharmacy benefit manager (PBM) partners who offer programs that promote medication adherence, such as using incentives like a copay discount when employees take their medications regularly.
3. Continued utilization of mail-order prescriptions
Mail-order prescriptions, for up to a 90-day medication supply, increased by up to 20% over 2019 levels, according to data from the first several months of 2020. As visits to traditional pharmacies have decreased during the COVID-19 pandemic and patients rely increasingly on mail-order or direct-to-patient delivery for their medications, 2021 will see continued evolution in the logistics of getting drugs into the hands of those who need them.
Plan sponsors can expect to work with PBM partners who are offering advanced or more efficient mail-order programs, driven increasingly by advancements in Artificial Intelligence (AI) and other new technologies, to help ensure employees are receiving medications seamlessly and effectively.
4. Growing emphasis on social factors
The impact of social determinants of health, such as economic stability, education level or neighborhood environment, on employees' overall health and well-being, will be of growing importance to plan sponsors. These factors can directly impact a member's health and costs. For example, food-insecure households spend 45% more on medical care than people in food-secure households. Identifying social determinants of health among employees will be essential for benefits professionals to effectively care for employees. As such, employers will be paying careful attention to social factors and seek to find PBM partners who have programs and initiatives in place that can help address the needs of their employees.
While COVID-19 brought unprecedented barriers to health care in 2020 and increased pressure on employer benefit costs, the pandemic has shone a light on new areas of pharmacy benefit management where benefits professionals and PBMs can not only cut costs, but also make a tremendous impact on employee health. From utilizing digital technologies to incentivizing individuals to take their medications, 2021 is set to be a transformational year for pharmacy benefits—and now is the time for plan sponsors to regain control.
Julie Olson is the senior director of population health at Navitus, a pharmacy benefit company committed to lowering drug costs and offering a 100% pass-through approach. With more than 27 years of experience in the health care industry, Julie leads a team of pharmacists and product managers to design, implement and execute population health programs.
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