Medical Pharmacy Trend Report: Managing the Trends and Complexity of Provider- Administered Drugs
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1 Medical Pharmacy Trend Report: Managing the Trends and Complexity of Provider- Administered Drugs Thursday, March 10, :00 2:30 EST 12:00 1:30 CST 11:00 12:30 MST 10:00 11:30 PST Casandra Stockman, PharmD Vice President, Medical Pharmacy Strategy Magellan Rx Management Kristen Reimers, RPh Vice President, Medical Pharmacy Strategy Magellan Rx Management To register additional people for the Webinar or to obtain the password/pin number or other logistics for the meeting, call AIS at Magellan Rx Management N. 76th Street, Suite 200 Scottsdale, AZ SW601
2 About the Speakers Casandra Stockman, PharmD, is the Vice President of Medical Pharmacy Strategy for Magellan Rx. In this role, she is responsible for analyzing and delivering medical pharmacy cost management and quality improvement initiatives for Magellan s health plan customers and potential clients. In previous roles with Magellan, she was responsible for the implementation and performance of Magellan s medical and specialty drug management services with health plans and employer clients across all lines of business. Casandra has previously held several roles within Magellan Rx including Vice President of Specialty Pharmacy Account Management, Senior Director of Product Development, and Director of Account Management and Product Development. As VP of Specialty Rx Account Management, she was responsible for implementation and performance of specialty drug management services for Magellan s health plan and employer clients including specialty rebates, specialty pharmacy distribution, and medical pharmacy management. In Product Development, she was responsible for leading development and enhancement of drug management services across Magellan s suite of pharmacy solutions, with focus on medical and integrated specialty pharmacy management strategies. In previous account management roles, she was responsible for the implementation and performance of medical pharmacy products for commercial health plan and Medicaid clients. Casandra received her Doctor of Pharmacy from the University of Rhode Island. Kristen Reimers, RPh, is the Vice President of Medical Pharmacy Strategy for Magellan Rx Management. In this role, Kristen focuses on analyzing and identifying medical pharmacy cost management and quality improvement initiatives for health plan clients and prospects. She is an integral part of the development and support of the Medical Pharmacy Strategy and serves as a clinical resource throughout the organization. She supports all clinical pharmacy programs involving medical specialty medications and additional clinical programs as needed. Kristen has extensive health plan pharmacy management experience. Prior to joining Magellan Rx Management, she played a key role in developing and leading an integrated specialty drug program for pharmacy and medical benefits, leading Utilization Management clinical and process development across all lines of business, clinical criteria development, and Medication Therapy Management programs. Kristen is a graduate of State University of New York at Buffalo, School of Pharmacy and Pharmaceutical Sciences. Contact Dr. Stockman and Ms. Reimers through Colleen Flanagan Johnson at CEFJohnson@magellanhealth. com or (860) Moderator: Angela Maas, Managing Editor of Atlantic Information Services, Inc. s Specialty Pharmacy News. This publication is designed to provide accurate, comprehensive and authoritative information on the subject matter covered. However, the opinions contained in this publication are those solely of the speakers and not the publisher. The publisher does not warrant that information contained herein is complete or accurate. The conference materials are published with the understanding that the publisher is not engaged in rendering legal or other professional services. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. Copyright 2016 Magellan Rx Management. All rights reserved. Organizations participating in the March 10, 2016, Webinar are hereby permitted to make one photocopy of these materials for each of their employees or contractors who listen to the live broadcast of the Webinar. ii
3 About the Sponsor Magellan Rx Management Magellan Rx Management is a full-service PBM that specializes in solving complex pharmacy challenges and driving better decisions. Our specialty management expertise, targeted clinical programs and whole patient health management, combined with our innovative reporting and analytics enable us to deliver value in a volume-focused market. Webinar Materials Medical Pharmacy Trend Report: Managing the Trends and Complexity of Provider- Administered Drugs Presentation by Casandra Stockman and Kristen Reimers... page 1 Webinar Outline Part 1: Casandra Stockman and Kristen Reimers, Magellan Rx Management Magellan Rx A Unique Vision of Care Product Preferencing and Utilization Management Benefit Design Reimbursement Trends Provider Network Landscape and Management Trends Health Plan Claims Insights Medical Benefit Drug Pipeline Key Legislative Trends Part 2: Questions and Answers Three Ways to Submit Your Questions for the 30-Minute Q&A Session The speakers presentation will run approximately 60 minutes and be followed by 30 minutes of questions and answers. Questions may be submitted in three ways: Prior to the Webinar (1) your question(s) to moderator Angela Maas at amaas@aishealth.com or During the Webinar (2) To send a question from the Webinar page, go to the Chat Pod located in the lower left corner of your screen. Type your question into the dialog box at the bottom and then click on the blue send button. (3) Dial *1 on your phone keypad and an operator will connect you to the moderator so that you can ask your question(s) live with the Webinar participants listening. iii
4 1 Medical Pharmacy Trend Report: Managing the Trends and Complexity of Provider- Administered Drugs 2015 Medical Pharmacy Trend Report
5 A Unique Vision of Care We have a unique vision of better and more affordable care in the fast-growing, highly complex and high-cost areas of healthcare. 2
6 3
7 Medical Pharmacy Trend Report- 6 th Edition Full Report Available at magellanrx.com 4
8 Product Preferencing and Utilization Management 5 5
9 Payors with Medical Benefit Product Preferencing in Place and by Disease State or Drug Category 6
10 Disease State or Drug Category with Step Edits 7
11 Medical Benefit Drug Rebates Received and by Plan Size 8
12 Analyze and Compare Outcomes and Monitor Market Share Changes for Medical Benefit Drugs Analyze and Compare Outcomes Monitor Market Share 9
13 Utilization Management Tools by Disease State or Drug Categories 10
14 11 Benefit Design
15 Payors Perception of Commercial Members Cost Share 12
16 Payors Required Member Contribution for Medical Benefit Drugs 13
17 Average In-Network Coinsurance Percentage and Copay Dollar Amount Average Coinsurance Percentage Average Copay Dollar Amount 14
18 Member Annual Deductible and Out-of-Pocket Maximum 15
19 Lower Member Drug Cost-Share Requirements Based on Medical vs. Pharmacy Benefits Coverage 16
20 Payors Practices with Varying Member Cost Share by Medical Benefit Drug 17
21 Payors Practices with Varying Member Cost Share by Provider Type 18
22 19 Reimbursement Trends
23 Reimbursement Methodology by Provider Type 20
24 ASP Percent Markup by Provider Type 21
25 AWP Percent Discount by Provider Type 22
26 Reimbursement Coding Methodology by Provider Type 23
27 AWP Discount for Newly Released, Unclassified Medical Benefit Drugs 24
28 Provider Network Landscape and Management Trends 25
29 Payors Experience with Office-Based Practices Purchased by Hospital System 26
30 Types of Office-Based Practices Purchased by Hospital Systems 27
31 Percent of Practices Purchased by Hospital Systems 28
32 Oncology-Specific Pilot Programs Initiated by Payors 29
33 Payor Tracking of Oncology Quality Measures 30
34 Members With Cancer Who Received Chemotherapy Within Last Two Weeks of Life Payors Who Knew Percent of Members Who Received Chemotherapy Percent of Members Who Received Chemotherapy 31
35 Forecasting Performed for Medical Benefit Drug Spend 32
36 Key Payor Survey Findings 33
37 34 34 Health Plan Claims Insights
38 Health Plan Claims Data Methodology Health plan claims data were collected through secondary analyses of commercial and Medicare. Claims data were analyzed for medical pharmacy utilization across all outpatient sites of service, including the physician office, home infusion, specialty pharmacy, and hospital outpatient facility. Vaccines and radiopharmaceuticals were excluded from the analyses. Administration codes were analyzed separately in only one analysis. Most analyses compared calendar years 2013 and
39 Medical Pharmacy Allowed Amount PMPM by LOB by Site of Service Commercial % Change % % % % Avg. 34% Medicare % Change % % % % Avg. -3% 36
40 2014 Commercial and Medicare PMPM by Disease State or Drug Category 37
41 Percent of Allowed Amount PMPM and Members by Disease State or Drug Category by LOB and ASP/AWP Trends
42 Allowed Amount PMPM for Top 100 Medical Benefit Drugs 2014 Top 10 Top 25 Top 50 Top % 64% 79% 92% 46% 69% 84% 94% 39
43 Commercial Top 25 Medical Benefit Drugs by Allowed PMPM Annual Cost per Patient and ASP-AWP Trends
44 Medicare Top 25 Medical Benefit Drugs by Allowed PMPM Annual Cost per Patient and ASP-AWP Trends
45 Highest Cost Medical Benefits Drugs for Commercial and Medicare In 2014, spend PPPY for the top 10 highest cost drugs averaged $353K for commercial and $271K for Medicare. Represents 0.02% of commercial and 0.04% of Medicare members. 42
46 Member Cost Share for Medical Benefit Drugs by LOB 43
47 2014 Commercial Top Diagnosis Codes for Medical Benefit Drugs 44
48 2014 Medicare Top Diagnosis Codes for Medical Benefit Drugs 45
49 Commercial Utilization, Annual Cost per Patient and Allowed Amount PMPM for BDAIDs: Rheumatoid Arthritis 46
50 Medicare Utilization, Annual Cost per Patient and Allowed Amount PMPM for BDAIDs: Rheumatoid Arthritis 47
51 Commercial Utilization, Annual Cost per Patient and Allowed Amount PMPM for Colony-Stimulating Factors 48
52 Medicare Utilization, Annual Cost per Patient and Allowed Amount PMPM for Colony-Stimulating Factors 49
53 Commercial Utilization, Annual Cost per Patient and Allowed Amount PMPM for IVIG Agents 50
54 Medicare Utilization, Annual Cost per Patient and Allowed Amount PMPM for IVIG Agents 51
55 Commercial and Medicare Cost per Unit and Claim for Top Drugs by Provider Type 52
56 Commercial and Medicare Utilization of Top Medical Benefit Drugs by Site of Service 53
57 Commercial and Medicare Top Administration Codes by Allowed Amount PMPM, Unit Cost, and Site of Service 54
58 Key Health Plan Claims Data Findings 55
59 Medical Benefit Drug Pipeline 56 56
60 Medical Benefit Drug Pipeline 57
61 Medical Benefit Drug Forecasting 58
62 59 59 Key Legislative Trends
63 Oncology Care Model (OCM) Update A five-year model slated to begin in spring OCM looks to develop multi-payer patient-centered oncology medical homes with a shared savings payment component encompassing the total cost of patient care during a six-month cancer chemotherapy episode. Under the OCM, practices will enter into payment arrangements that include financial and performance accountability for episodes of care surrounding chemotherapy administration to cancer patients. Forty-three payers and 443 practices submitted letters of intent (LOI); all payers and about a third of the practices submitting LOIs completed applications. CMS is expected to make an announcement in the first quarter of
64 Value Frameworks and Tools for Physicians ICER ETAP 1 In July 2015, the Institute for Clinical and Economic Review (ICER) announced its plan to launch the Emerging Therapy Assessment and Pricing (ETAP) Program. The ETAP Program seeks to address what it considers rapidly rising costs of drugs and other therapies through independent analysis of the drugs comparative effectiveness, cost-effectiveness, and potential budget impact. ASCO s Value Framework 2 In June 2015, ASCO released its value framework methodology, in which it states the intention to create an interactive tool to help physicians and patients assess the value of cancer treatment options and facilitate shared decision making. The tool would allow the comparison of a new treatment regimen to the current standard of care for a particular cancer indication using data from a prospective, randomized trial. National Comprehensive Cancer Network Evidence Blocks 3 In March 2015, the National Comprehensive Cancer Network (NCCN) first released details of its NCCN Evidence Blocks, which display ratings based on expert consensus on five dimensions of value: efficacy, safety, quality of evidence, consistency of evidence, and affordability. National Comprehensive Cancer Network DRUGABACUS 4 Also in 2015, Peter Bach and Memorial Sloan Kettering developed an interactive tool to calculate the appropriate monthly drug cost that should be charged to obtain a specific cost per life year gained threshold. 1. Institute for Clinical and Economic Review. ICER Launches New Drug Assessment Program with $5.2 Million Award from the Laura and John Arnold Foundation. July 21, American Society of Clinical Oncology. American Society of Clinical Oncology Statement: A Conceptual Framework to Assess the Value of Cancer Treatment Options. June 22, National Comprehensive Cancer Network. NCCN Unveils Evidence Blocks for CML and Multiple Myeloma. October 16, DrugAbacus. 61
65 Part B Biosimilars Payment Policy 5 In October 2015, CMS finalized its proposal to 1) place all biosimilar biological products of the same reference product in the same billing and payment code and 2) base the payment amount for a biosimilar biological product on the ASP of all NDCs assigned to the same billing and payment code. This approach is similar to the ASP calculation for multiple source drugs except that the reference product is not included. 5. Biosimilars CMS Final Rule, 62
66 Full report available at 63
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