Current Weather
The Spy FM

Why Your Drug Copay Could Change

Filed by KOSU News in Health.
May 8, 2012

What if how much you paid for a drug was based on how much it might help you, instead of the sticker price?

Some big employers are already taking this tack, known as value-based insurance design, by lowering copayments for medicines to manage chronic conditions like diabetes, high cholesterol and high blood pressure. It helps that many of the most prescribed pills are now generic and pretty cheap.

It’s a simple idea when applied this way. The companies figure that if people take those medicines and stay healthy, they’ll avoid costly treatment down the road. By slashing copayments, the companies hope to remove a hurdle that might discourage people from sticking with the drugs.

Now some employers are thinking about adapting the approach for pricier specialty drugs, such as those used to treat rheumatoid arthritis, multiple sclerosis and cancer, according to a recent report by the Center for Studying Health System Change.

These medicines are often very expensive and have no generic competition. So instead of charging a simple copay for these drugs, some health plans charge a percentage of the total cost, which can run to thousands of dollars a month.

It’s one way that insurers and employers are looking to stem the rising costs of specialty drugs, whose growth is far outpacing that of traditional drugs.

But in the latest twist, some companies are looking to vary the copayment depending on the value the drugs provide.

It isn’t easy. For starters, figuring out who is an “appropriate candidate” for specialty drugs can be tough, say experts including James Robinson, an economist at the University of California, Berkeley, who has published articles advocating this insurance model.

Even if a specialty drug has been proved clinically effective for certain conditions, should all patients pay the same amount for it? Take a drug like Enbrel, which is approved to treat inflammatory conditions, including rheumatoid arthritis and psoriasis. According to the HSC report, drugs of this type cost $14,455 per year, on average.

Psoriasis is disfiguring and uncomfortable, but not fatal, Robinson says, while rheumatoid arthritis is a much more disabling condition. In this case, a value-based insurance design approach might determine that “if you’ve got psoriasis, maybe you pay a 30 percent coinsurance for the drug,” he suggests. “But if you’ve got rheumatoid arthritis, there’s no copayment.”

That’s just the tip of the iceberg. “This stuff is complicated,” says Robinson. “I don’t want to blow you away with the intractability of the problem.”

As spending on specialty drugs grows, and despite the difficulties, some experts predict more employers will adopt “value-based” principles for their workers’ coverage. [Copyright 2012 Kaiser Health News]

Leave a Reply

7PM to 9PM Juke Joint Revival

Juke Joint Revival

Juke Joint Revival rivals any Rockabilly/Roots show on the air today, and the host of that program, Jenni Zee, lives and breathes the Rockabilly lifestyle. Her show has drawn the attention of Rockabilly fans the world over.

Listen Live Now!

9PM to 10PM The Spy

The Spy

An eclectic mix of the Spy's library of more than 10,000 songs curated by Ferris O'Brien.

View the program guide!

10PM to 11PM The Blank Generation

The Blank Generation

Our punk show, The Blank Generation, is hosted by Katie Jones and Chad Hunnicutt. Katie has been attending punks shows for more than half her life. Chad is a member of local band, The Muck Savages.

View the program guide!

Upcoming Events in your area (Submit your event today!)

Streaming audio and podcasts

Stream KOSU on your smartphone

Phone Streaming

SmartPhone listening options on this page are intended for many iPhones, Blackberries, etc. with low-cost software applications available to listen to our full-time web streams, both News on KOSU-1 and Classical on KOSU-2.

Learn more about our complete range of streaming services

We're perfecting the patient experience - Stillwater Medical Center