Controlling costs with specialty utilization management
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The cost of specialty drugs has dramatically increased in the last several years. From 2013 to 2017, specialty drug spend in the U.S. rose from $83 billion to $157 billion.
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To manage these rising costs, Independence uses specialty utilization management (UM). With UM, we can consider how effective specialty medications are, as well as the risks associated with treatment. Some of the UM strategies Independence uses include:
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- Precertification and prior authorization: Requires providers to obtain preapproval from the health plan or PBM for certain drugs before they administer treatment or the drug can be dispensed
- Quantity limits: Prevents excessive dispensing of drugs based on FDA‑approved dosing
- Age edits: Applied to drugs that have recommended ages for use, according to the package insert
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Coverage criteria
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Strong policies are the backbone of our UM programs. Multiple factors go into developing the criteria for coverage of specialty drugs, including its place in therapy, efficacy, safety, and cost. Clinical trials, clinical practice guidelines, and drug labeling form the evidence‑based pillars of our drug policies. In cases where multiple drugs treat the same condition with similar efficacy, Independence may establish a preferred product for the lowest‑cost drug.
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It is important to favor drugs with both clinical effectiveness and lower cost. UM can identify members who may respond to more traditional treatments first, resulting in lower overall health care costs while ensuring members still receive appropriate standard‑of‑care therapy. It also educates members about more affordable treatment options.
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The carve‑out question
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In recent years, some plan sponsors have proposed moving specialty drug management from pharmacy benefit managers (PBM) to third‑party vendors, known as a “specialty carve‑out.” However, using multiple parties can fragment the member’s overall care experience.
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In a carve‑out, specialty drugs may not be subject to drug utilization reviews, which ensure members are not on duplicate or inappropriate therapy. This review is crucial, especially for members who use multiple pharmacies or who are taking both specialty and standard drugs.
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Third‑party vendors also claim to have better access to specialty drugs than PBMs; however, PBMs often provide integrated support from the initial prior authorization until the first fill. This helps members get their medication with as little hassle as possible.
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Finally, while third‑party vendors promise greater value, there are other costs that are often overlooked when using a vendor, including fees for coupon services and integration/data exchange fees. These costs may erode the vendor’s promised savings.
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For these reasons and others, Independence does not advocate specialty drug carve‑outs. Our UM programs:
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- Effectively control costs and utilization
- Ensure that members have appropriate access to specialty drugs
- Deliver an integrated approach across the health care continuum to optimize member outcomes
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Controversial Alzheimer’s drug approved by FDA
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There has been a lot of talk in recent months about the drug AduhelmTM (aducanumab‑avwa). As the first treatment for Alzheimer’s disease in nearly 20 years, many hoped Aduhelm would help the more than six million Americans affected with the memory‑robbing condition. However, its recent approval by the FDA has many questioning the drug’s efficacy, clinical trial results, and serious side effects.
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No stranger to controversy
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Controversy over Aduhelm goes back to 2019, when the drug was in clinical trials. Its manufacturer, Biogen, suspended two key trials for a variety of reasons, most notably because interim study results showed no difference between study participants receiving Aduhelm and those receiving the placebo.
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The following year, Aduhelm was submitted to the FDA. Its application was reviewed by an 11‑member Advisory Committee that offered a nearly unanimous rejection of the drug, based on significant concerns, including the following:
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- Clinical trials showed conflicting results about improvements in cognitive function.
- Biogen removed some study participants deemed as “rapid disease progressors,” who would negatively skew the findings.
- Aduhelm had side effects — most notably, brain swelling.
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FDA approval and beyond
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In June, the FDA approved Aduhelm for the treatment of Alzheimer’s disease based on the drug’s ability to reduce amyloid beta plaques in the brain. These plaques are associated with Alzheimer’s disease, but it is unknown if reducing plaque levels produces cognitive improvement.
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Three physicians from the Advisory Committee that initially rejected the drug’s application resigned in protest, stating that the FDA did not take their concerns into consideration when approving the drug. Industry critics pointed out that, even though Aduhelm was approved for all stages of Alzheimer’s disease, it had only been studied in people with mild dementia. This led to concerns over the drug’s potential cost burdens, particularly if everyone with the disease was considered a viable candidate for treatment. Cost estimates for the drug are about $70,000 a year.
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Subsequently, the FDA narrowed its approval, stating that Aduhelm should only be used to treat mild cognitive impairment or mild dementia associated with Alzheimer’s disease. This narrower approval does not address the lack of convincing data for Aduhelm, and safety concerns remain.
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Independence’s coverage position
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Aduhelm must be given by a health care provider, so Independence classifies it as a medical benefit drug.
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Independence’s coverage position is based on whether the member is a commercial or Medicare Advantage health plan member:
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- Commercial members: Independence determines coverage positions based on currently available evidence. Aduhelm is not covered for Commercial members. It is considered experimental/investigational because its safety and/or efficacy cannot be established by review of the available peer‑reviewed literature. The experimental/investigational position applies to any services associated with this treatment, as well as any off‑label use.
- Medicare Advantage members: Our Medicare Advantage plans must follow coverage positions established by the Centers for Medicare & Medicaid Services (CMS). CMS estimates that it could take up to nine months to establish their coverage position on Aduhelm. Currently, Independence will provide review for a coverage determination per CMS’s “Reasonable and Necessary” criteria using available evidence. Absent additional guidance from CMS, and due to the outstanding questions and limitations in the peer-reviewed, published literature, Aduhelm does not meet the CMS definition of reasonable and necessary because its safety and effectiveness cannot be established.
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Independence will continue to evaluate any newly published data for Commercial and Medicare Advantage members. We will also follow CMS guidance for Medicare Advantage members, once it is published, to ensure that our coverage decisions on Aduhelm are up‑to‑date and medically appropriate.
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What’s next?
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The FDA approval of Aduhelm has raised many questions, particularly around cost, coverage, and the clinical studies that were the backbone of the approval. Biogen has nine years to conduct follow‑up studies to determine the safety and efficacy of Aduhelm, so it may be some time before we have all the answers.
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In the meantime, the FDA’s interim Commissioner has requested an independent investigation to determine if Biogen attempted to influence the FDA’s decision. In addition, the House Committee on Oversight and Reform is conducting its own investigation into both the FDA’s approval process and Biogen’s business practices, including the pricing of Aduhelm.
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