Pills and money
The number of employers offering 'preventive drug lists', or PDLs, increased between 2005 and 2017. A PDL is a list of drugs that may help prevent serious illnesses and complications. These medications can reduce out-of-pocket costs, increase medication adherence and decrease the risk of diseases worsening, especially among poorer, sicker individuals.
“PDLs are a particularly promising, broad value-based benefit, because they lower or eliminate out-of-pocket payments for many generic and branded medications that need to be taken regularly to prevent worsening of chronic conditions and diseases,” according to a report in the American Journal of Managed Care.
Patients whose employers offered PDL coverage experienced 35% to 55% relative reductions in out-of-pocket payments during the study period. These effects were greatest among lower-income patients and those in high-deductible health plans and health savings accounts.
Cowering out-of-pocket costs of prescription drugs needed to treat chronic illnesses is especially important for individuals with prevalent chronic conditions such as diabetes or those exposed to high medication costs, such as individuals in HDHPs and HSAs who pay full medication costs until annual deductibles are met. In 2019, the Internal Revenue Service expanded the list of services classified as preventive in HDHP-HSAs to include prescription drugs for certain chronic conditions, which allowed members to receive these drugs as preventive care that is not subject to deductibles.
The increase in the number of employers offering PDLs during the study period was most significant among larger companies:
- In 2017, almost 43% of employers with 5,000 or more insured workers offered PDLs. This was four times more than employers with 50 to 199 workers.
- Among employers with at least 85% of their insured workforce in HDHPs with HSAs, 32% offered PDLs in the last benefit year, compared with 13% of other employers.
- In adjusted analyses, HDHP-HSA employers with older workforces and those with more chronically ill employees were more likely to offer PDLs than employers with workforces living in poorer neighborhoods.
“PDLs should benefit mostly those who are vulnerable to high out-of-pocket costs for chronic disease medications,” the report said. “Members in HDHP-HSAs must pay payer-determined prices for drugs out of pocket until they meet their annual deductible amounts. By adding a PDL benefit for members in an HDHP-HSA, employers can substantially reduce or eliminate patient cost-sharing for PDL medications that treat cardiovascular diseases, diabetes, asthma and other chronic conditions, facilitating adherence to treatment.”
Offering PDLs could be an effective strategy for larger employers, especially those with a high number of chronically ill workers.
“Combined with recent evidence of employer interest in increasing pre-deductible coverage for additional health care services, these findings suggest an encouraging trend toward improved health care access among commercially insured adults,” the report concluded.
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