Impact of cost sharing on specialty Drug Utilization and outcomes: a review of the evidence and Future directions

Doshi, JA; Li, P.; Ladage, Vrushabh P.; Taylor, Erin Audrey

doi:10.1016/j.jval.2015.03.468

Cited by 19 publications

(24 citation statements)

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“…This finding is consistent with the conclusion in a recent literature review (Doshi et al, 2016a). However, our estimates of the price elasticity of specialty cancer drug use are larger than the estimates in studies of employer-sponsored plans.…”

Section: Discussionsupporting

confidence: 94%

“…In a recent review of this literature, Doshi et al (2016a) reported larger price effects for non-initiation or prescription abandonment at the pharmacy than for refills or total drug spending among users. Complementing this review, we discuss several studies that reported price elasticity estimates of specialty drug use and explain how their approaches differ from ours.…”

Section: Introductionmentioning

confidence: 99%

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The Price Elasticity of Specialty Drug Use: Evidence from Cancer Patients in Medicare Part D

Jung

Feldman

McBean

2017

Forum for Health Economics and Policy

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Specialty drugs can bring substantial benefits to patients with debilitating conditions, such as cancer, but their costs are very high. Insurers/payers have increased patient cost-sharing for specialty drugs to manage specialty drug spending. We utilized Medicare Part D plan formulary data to create the initial price (cost-sharing in the initial coverage phase in Part D), and estimated the total demand (both on- and off-label uses) for specialty cancer drugs among elderly Medicare Part D enrollees with no low-income subsidies (non-LIS) as a function of the initial price. We corrected for potential endogeneity associated with plan choice by instrumenting the initial price of specialty cancer drugs with the initial prices of specialty drugs in unrelated classes. We report three findings. First, we found that elderly non-LIS beneficiaries with cancer were less likely to use a Part D specialty cancer drug when the initial price was high: the overall price elasticity of specialty cancer drug spending ranged between −0.72 and −0.75. Second, the price effect in Part D specialty cancer drug use was not significant among newly diagnosed patients. Finally, we found that use of Part B-covered cancer drugs was not responsive to the Part D specialty cancer drug price. As the demand for costly specialty drugs grows, it will be important to identify clinical circumstances where specialty drugs can be valuable and ensure access to high-value treatments.

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Section: Discussionsupporting

confidence: 94%

Section: Introductionmentioning

confidence: 99%

The Price Elasticity of Specialty Drug Use: Evidence from Cancer Patients in Medicare Part D

Jung

Feldman

McBean

2017

Forum for Health Economics and Policy

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“…To the extent that these centralized mechanisms succeed in their stated goals of promoting cost‐effective cancer therapies, they reduce the need to shift financial responsibility from insurers to physicians. They also reduce the need to shift risk from insurers to patients in the form of out‐of‐pocket cost sharing …”

Section: Resultsmentioning

confidence: 99%

Value‐Based Physician Payment in Oncology: Public and Private Insurer Initiatives

Robinson

2017

Milbank Quarterly

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Public and private insurers are implementing payment mechanisms to improve coordination and reduce the cost of drug, hospital, and ancillary services for cancer patients. Some target unnecessary hospitalization, while others create incentives for prescribing lower‐cost chemotherapies and biologics. Physician payment methods in oncology require a balance between incentives for cost control and incentives for patient access to expensive specialty drugs. None of the initiatives adopt bundled methods out of concern for shifting excessive financial risk onto physicians in the context of rapid pharmaceutical innovation. Context High‐value oncology requires physicians to monitor and coordinate all aspects of care, educate and engage their patients, and adopt cost‐effective drug treatments. However, oncology practices in the United States traditionally have been reimbursed based on the number of office visits performed and through cost‐plus margins from prescription of expensive drugs. Public and private payers now are experimenting with methods of payment that include monthly care management fees, annual bonuses, and incentives for conservative choice among alternative drug regimens. Methods This paper uses case study methods to examine oncology payment initiatives at Medicare, Anthem, Aetna, and UnitedHealthcare, the nation's largest public and private health insurance plans. Findings The 4 insurers supplement traditional fee‐for‐service payment with payment methods designed to promote coordination of care and conservative use of health care resources. Medicare, Aetna, and UnitedHealthcare reward oncology practices that reduce per‐patient spending, targeting unnecessary patient visits to emergency departments and hospitals. Anthem offers monthly payments to practices that adhere to lower‐cost drug treatment pathways; Aetna increases the percentage markup on low‐cost generic chemotherapies but not on high‐cost biologics; and UnitedHealthcare removes the linkage between physician payment and spending on office‐infused drugs. As a condition for receiving the new payments, each of the initiatives requires participating practices to report and, in some cases, improve performance on quality metrics. None of the initiatives bundles payment for oncology drugs together with payment for other oncology services, out of concern for shifting financial risk onto physicians and creating access barriers for patients. Conclusions The emerging “value‐based” methods of oncology payment supplement fee‐for‐service and cost‐based reimbursements with per‐month and per‐episode payments, but none of the payers bundle spending on cancer drugs with payments for other services. Payers recognize that bundled payment could create access barriers for patients and undermine innovation in effective but expensive new pharmaceuticals.

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“…Studies have shown that although higher cost-sharing is generally associated with reductions in specialty drug utilization, the effects varied significantly by type of disease and specialty drug. 20 There are two important recent studies 21,22 that examined TKI usage among Medicare beneficiaries with CML. Both studies mainly focused on the initiation of TKI therapy among newly diagnosed CML patients and both found that patients with low-income subsidies were more likely to initiate TKI treatment.…”

Section: Introductionmentioning

confidence: 99%

Adherence to tyrosine kinase inhibitors among Medicare Part D beneficiaries with chronic myeloid leukemia

Shen

Zhao

Liu

et al. 2017

Cancer

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Impact of cost sharing on specialty Drug Utilization and outcomes: a review of the evidence and Future directions

Cited by 19 publications

References 0 publications

The Price Elasticity of Specialty Drug Use: Evidence from Cancer Patients in Medicare Part D

The Price Elasticity of Specialty Drug Use: Evidence from Cancer Patients in Medicare Part D

Value‐Based Physician Payment in Oncology: Public and Private Insurer Initiatives

Adherence to tyrosine kinase inhibitors among Medicare Part D beneficiaries with chronic myeloid leukemia

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