Five Measures to Cope with the Side Effects of Health Reform

Pharmaceutical Executive

With more than 8 million Americans now signed up for health insurance through state health exchanges, The Affordable Care Act (ACA) has begun delivering benefits and new insurance protections to a large swath of Americans, many of whom had no health insurance before.

With more than 8 million Americans now signed up for health insurance through state health exchanges, The Affordable Care Act (ACA) has begun delivering benefits and new insurance protections to a large swath of Americans, many of whom had no health insurance before. People previously rejected by insurers due to pre-existing conditions now have end-to-end coverage.

But along with such safeguards and the broad extension of coverage come some significant challenges or “side effects.”  Everyone from patients to policymakers is starting to understand the true cost associated with the benefits.

One major side effect of the need to hold down premium costs on the ACA exchanges is the implementation new benefits designs such as novel cost-sharing arrangements which threaten to place some medicines out of reach for many patients.

In addition, patient access to medical specialists most likely to understand and prescribe certain treatments may be circumscribed. Such restrictions pose challenges for both patients and the biopharmaceutical companies providing treatments.   The challenges of such restrictions and benefit designs are not just the pains of transition but are fundamental to the system and likely to become even more pronounced as the number of Americans enrolled in the exchanges skyrockets.

With a predicted tripling in enrollees, benefit designs such as higher cost sharing and tighter formulary controls could extend beyond the state exchanges to private exchanges and into the broader commercial health insurance market. More and more Americans are likely to be affected.

Given these developments and the rapid evolution of the marketplace, it is not too soon for biopharma companies, patients and other stakeholders to start advocating for policies that enable patient access to essential treatments.

Companies should look quickly and closely at benefit designs, cost-sharing features and formulary decisions already impacting patients nationwide. In an increasingly complex and ever-shifting landscape where it is necessary to understand evolving formularies in 50 states, good public affairs counsel is indispensable.

While health reform is still evolving, biopharmaceutical companies, advocacy organizations and patient groups must make their voices heard.

Formulary status is an immediate and constant threat to patient wellbeing. Last December, for example, Express Scripts and Caremark, which handle pharmacy benefits for more than 200 million Americans, announced that they would remove nearly 50 brands from their formularies starting in January 2014. Early research suggests that such formulary designs in ACA exchanges are even more restrictive than in the employer-based health insurance market.

It may appear at first that the restrictions being placed on access and decisions on formularies are unalterable.  Insurers simply send a letter to all healthcare providers regarding a specific therapeutic category and it looks like a fait accompli. It seems nothing can be done.  But health reform is dynamic and sensitive to external inputs - especially to the voices of patients.

Companies are well positioned to support their patients by making sure a plan is in place to defend access to treatment the moment policymakers move to reduce such access.

In fact, insurance benefit designs on the early exchanges are not yet written in stone.  If specific benefit changes prove unacceptable to many plan members, political activism could redraw the plan. Patient organizations and pharmaceutical companies also may be able to slow the spread of benefit reductions by strategically expanding communications that highlight patient needs and incorporate persuasive HEOR data.

But the onus is on brand managers. Working in concert with colleagues and counsel in government affairs and managed markets, companies can preempt action by payers and pharmacy benefit managers and quickly educate patients on the impact of policy changes.

Here are five things - suggested in a recent white paper by my colleagues at Breakaway Policy Strategies - that should be done today:

  • Identify products that are potential targets for cost sharing, including new and specialty medicines.  Obviously, the more expensive or the less unique a drug is seen to be, the more likely it is to require clear explanation.

  • Reach out to patient groups and high-profile patient bloggers to begin discussion on patient perspectives, wants and needs.

  • Provide clear and compelling educational materials to organizations that help demonstrate a medicine’s value - and not just measured against a placebo but in the form of comparative data that show cost savings realized by avoiding medical interventions and/or hospital stays.

  • Where ACA safeguards are insufficient, product suppliers should consider advocating for additional state or federal policy interventions. Suppliers should work with stakeholders to develop persuasive content and coordinate communications to assure the content breaks through the noise, especially information on value and pricing.

  • Assume that external and internal communications are visible to payers and make sure all communications around a drug’s value are consistent and aligned, inside the organization and out.

The ACA has begun to deliver on its promise of improving access to medical care for millions of patients. But the real impact of reform will not be known until we see how benefit designs affect access to medicines, health products and services.

The exchanges have shown their hands. Tradeoffs must be made in patients care to realize moderate premiums under the ACA. It is time now for patients and providers of products and services to make sure their voices are heard.

Sydney Rubin is a senior communications consultant with inVentiv Health.