Holding back the tide of health care spending is enough to give any executive or business owner a headache.

“It’s a real challenge, but one we all have to take up,” said Paul “Buzzy” Mize, vice president of Ross & Yerger.

Although prescription drug spending has receded from its high in 2014, it continues to command a substantial portion of health care dollars.

“In 2017, prescription drugs accounted for 10 percent of U.S. health spending but 21 percent of employer insurance benefits,” according to an analysis by Kaiser Family Foundation. “That is not much less than the 23 percent employers spent on inpatient hospital care.”

Prices on specialty and brand name drugs have continued to climb. Fifty drugs account for 40 percent of all prescription spending, according to the Kaiser analysis.

“If you see it advertised on TV, it’s probably a specialty drug,” said Wally Davis, vice president for managed care for North Mississippi Health Services.

Sometimes high cost drugs are the only route available, Davis said.

“They can allow people to function; that’s good for employers and good for the person,” he said.

Other times, the advertising can eclipse less expensive medications in the same class that have the same clinical outcome. Davis points to medications for hepatitis C, which have been revolutionary.

“One costs $90,000 and the other costs about half that for a course,” Davis said. “And they have identical clinical outcomes.”

Because of the complexity of medicine and health insurance, doctors in the clinic may not know the list prices of medications and the out-of-pocket costs to patients.

“Science is outpacing the distribution system,” Mize said.

Pharmacists and other experts can help monitor both price spikes and data on clinical outcomes. They can work with health care providers to get the patient the least expensive drug that delivers good outcomes.

“We want clinical experts to look at medical literature to find if we can get better results from lower cost alternatives,” Davis said.

The expertise is definitely paying off.

“We’ve seen that we can save our clients more than $100,000,” said Jordan Baxter, Jordan Acclaim client services financial manager.

It’s not just heavily specialty advertised drugs that can cost big bucks when there are comparable alternatives available for much less. Brand name acne medications can cost $1,700 for a 30–day supply compared to $30 for a generic.

One of Baxter’s family members was recently prescribed a brand name medication to help with knee pain after ibuprofen had upset his stomach. A 30–day supply was $1,274. Baxter did some sleuthing about the ingredients.

The name–brand pills combined ibuprofen and an antacid at strengths available without a prescription. Off the shelf, a 30–day supply of those medications would have cost less than $10. But it took digging into components of the pill – it wasn’t obvious.

Accessing pharmacy experts is becoming increasingly important to get the most value out of health care dollars. Integrated health care systems are increasingly bringing pharmacists into the clinical care team, Davis said.

As part of a value-based approach, NMHS is using pharmacists and case managers to evaluate home infusion patients who may qualify for patient assistance programs on the front end.

“It reduces costs to the patient and the plan costs,” Baxter said.

Pharmacy benefit managers can offer the expertise to find the sweet spots for cost savings and clinical outcomes. But employers also need to be wary in this area. Pharmacy benefit managers and an opaque labrinyth of manufacturer rebates have been the subject of much scrutiny in the efforts to bend the curve on the cost of health care. But accessing the expertise of a trusted partner can be invaluable when it comes to tracking “Transparency is key,” Davis said.

The underlying driver of prescription drug costs is chronic conditions. Employers are also seeing value in having case managers work with their employees who have chronic conditions.

“The reality is we have an aging population,” Davis said. “With an aging population, you expect increasing amounts of chronic conditions.”

Controlling high blood pressure and diabetes can reduce emergency visits and hospital stays that are costly and disruptive for both businesses and individuals.

“It’s very helpful,” Mize said.

Businesses have to walk a tight rope, balancing finances and employee well-being. The right medications can keep valuable employees healthy and on the job – a win for both employer and employee.

“You have to be mindful,” of cost shifting, Mize said. “If their medications are too expensive, they won’t buy what they need or they’ll only take half of what they need. That’s never a good result.” n

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