Demand curves still slope downwards

Unsurprisingly, high-deductible health plans lead to lower utilization of healthcare services. A study by Sandoval et al. (2021) use data from 2007-2019 from Switzerland to show that this is the case. Participants with high-deductible plans reported forgoing health care more frequently than those with low-deductible plans (331 [13.5%] vs 591 [8.7%]). In adjusted analysis, higher-deductible…

How ICER will conduct it’s “Barriers to Fair Access” Assessment

Last fall, ICER published a white paper titled “Cornerstones of ‘Fair’ Drug Coverage: Appropriate Cost-Sharing and Utilization Management Policies for Pharmaceuticals.” To paraphrase, ICER’s goal is to limit access restrictions (e.g., cost sharing, coverage limitations, prescriber restrictions, step therapy) when a drug is deemed to be cost effective. How will they do this? Their Barriers…

Rebates and out-of-pocket cost

In recent decades, drug prices have risen. To offset this cost, pharmacy benefit managers have negotiated increasingly large rebates which drug manufacturers pay health insurers. PBMs argue that rebates help keep net drug prices down. Manufacturers argue that PBMs want higher list prices so they can negotiate larger rebates. Patients may not like rebates if…

Bagging it

How do you get your prescription drugs? For most people, it involves going to your local pharmacy and picking up your pills. But what if the drugs you needs are infused treatments that have to be administered at a physician’s office? Typically, you just show up at a physician’s office and it’ll be ready for…

Which strategies are payers and employers using to cover orphan drugs?

This is the question posed by a recent article by Lopata et al. (2021). The authors surveyed 26 payers (e.g., leaders of national, regional, local, Medicaid, and Medicare plans; payer components of integrated delivery systems; and pharmacy benefit managers (PBMs) and 11 employers (e.g., large employers, employee benefit consultants, employer coalitions). Respondents were informed that…

Will health plan outreach increase take-up by enrollees that are healthier or sicker?

Why don’t people eligible for health insurance exchange plans (i.e., Obamacare plans) enroll? One reason could be that they value the health insurance benefit at less than the cost. Another reason could be behavioral frictions; informational search costs and psychological frictions are costly and may preclude enrollment even when benefits are more than cost. For…