Medicaid's New Reality

Nov 13, 2014
Sustaining high-quality care in an era of extreme price inflation and population growth.
  • Medicaid
  • Hepatitis C
  • HIV
  • Cancer
  • High Blood Cholesterol

A 33-year-old single mother of three children with hepatitis C. A 45-year-old disabled father unable to maintain steady work. A 15-year-old high school student recently diagnosed with cancer.

These three patients are potential candidates for new, potentially life-changing therapies that cost tens of thousands of dollars, and all three represent millions more people with similar health concerns.

Who gets treated? And how? This is the new reality for Medicaid plans. These are the decisions Medicaid plans and the states they serve now face every day.

Breakthrough Therapies: A Serious Burden for Medicaid Plans

Never before have we seen such high prices for medications used by large patient populations. New therapies in the pipeline bring great promise to patients with conditions such as cancer, high cholesterol and hepatitis C. But that promise could be very costly if drug manufacturers continue to price their medications unreasonably high. In that scenario, state Medicaid plans will be forced to pay tens of thousands of dollars each year for each of the millions of patients who are afflicted with these conditions.

Costly High Use Drugs on the Horizon 

In the case of hepatitis C, a recent analysis by Express Scripts shows that new therapies Harvoni® (ledipasvir and sofosbuvir) and Sovaldi® (sofosbuvir) have costs that we usually only see with orphan drugs, yet they have a population that is 48 times larger than the next most prevalent “orphan” condition. 

States will end up shouldering the bulk of the costs for these medications, forcing major financial trade-offs with Medicaid benefits as well as other important programs – and increasing the tax burden for residents.

Strategies for Effective Management of High-Cost Medications

While Express Scripts and our clients continue to advocate for more sustainable and fair drug pricing, there are important strategies Medicaid plans can implement now to ensure the most appropriate use of these medications. 

Utilization Management: Tighter management for high-priced specialty medications can help ensure the right patients receive the right treatment. For example, newer hepatitis C therapies are approved for patients with genotype 1 of the virus, a population of approximately 2.4 million patients nationwide. Yet not all of those patients may have an active disease that is showing signs of progressing toward impaired liver function. Tighter prior authorization rules can limit use of the medication to those in greatest need and help prevent sale of expensive therapies on the black market.

Clinical Specialization: Administration of high-cost specialty medications can be complex and a significant barrier to adherence. Express Scripts specialist pharmacists have unique, condition-specific expertise in disease categories ranging from diabetes and asthma, to hepatitis C and HIV. Why does it matter? Like a medical specialist, our pharmacists have deep condition and therapy-specific knowledge. They also have “muscle memory” from repeated experience helping to coach and support members dealing with questions or concerns about their medications – which is key to effectively helping patients overcome nonadherence.

Our studies show that specialized focus can help improve medication adherence compared to retail pharmacies; for example, in patients with cancer, our specialized focus improved medication adherence by 16% and in patients with multiple sclerosis, adherence improved 32%. This type of improvement becomes critically important in patients taking newer hepatitis C therapies or HIV medications, as nonadherence can lead to therapy resistance and other serious and costly complications. In fact, a recent analysis shows that hepatitis C patients who do not experience the unique clinical model available through Express Scripts’ Accredo specialty pharmacy are nearly twice as likely to fail their therapy.

Evidence-Based Decision Support: Express Scripts physician decision support programs help ensure greater adherence to evidence-based treatment protocols; improve coordination of care among all members of a patient’s care team; and alert physicians, in real time, to potential gaps in care and severe adverse events. These programs also help physicians identify the best delivery mechanisms for specialty medications – for example, administering chemotherapy in a nearby, less costly clinic versus a hospital. Approximately 35% of treatment plans deviate from evidence-based guidelines, resulting in $25,600 in waste per patient. Improving communication with physicians and coordination of care can prevent waste, manage costs and improve patient outcomes.

Between Medicaid enrollment growth in the past year and the surge of extremely high-priced medications, no Medicaid plan in this country will be able to survive the onslaught of these new breakthrough therapies without using every tool available to ensure the safe and appropriate use of these therapies.

Author Bio

Lab Staff
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