Rising Pharmacy Costs – Strategies to Address – Webinar Recap

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It’s no secret that rising pharmacy costs are a serious challenge for the health plans, health systems, sponsors and individuals on the hook for paying for them. Our healthcare executive members ranked “Addressing Pharmacy Costs” as #9 on the 2018 HCEG Top 10 list.

How Can Health Plans and Health Systems Address Rising Pharmacy Costs?

On Wednesday, November 13, 2017, Pete Biagioni, Managing Partner at Cumberland Consulting Group, and Marcia Lambert, Partner at Cumberland Consulting Group presented “Strategies to Address Rising Pharmacy Costs,” Cumberland Consulting Group’s entry in this month’s HCEG Webinar Series. 

The webinar provided attendees with a lot of great insight and information on the following:

  1. An overview of trends in growth of pharmacy costs
  2. Pharmaceutical Distribution Channels
  3. Drivers of specialty pharmacy spend
  4. Drug cost management strategies
  5. What strategies health plans and health systems can implement to address rising pharmacy costs

Trends in Rising Pharmacy Costs

Rising pharmacy costs trends Specialty Pharmaceuticals Management Strategies Distribution Reimbursement System Provider Administered, Outpatient Prescription Drugs

Specialty Pharmaceuticals – a 95% increase in just two years!

Pete Biagioni kicked off the presentation by highlighting that prescription drug spending is now the largest category in healthcare benefit spending – outpacing specialty care, inpatient and outpatient costs. Pete added that not only is prescription drug spending the largest healthcare expense but it’s also the fastest-growing category of benefit spending!

Largest contributor to increases in rising pharmacy costs are Specialty Drugs – with a 95% increase* in just two years!

How Drug Prices are Determined in the United States

One interesting part of the presentation was Marcia Lambert’s overview of the Pharmacy Distribution and Reimbursement System for Patient-Administered vs. Provider Administered, Outpatient Prescription Drugs in the U.S.  Several very detailed and informative slides were shared.  These slides identified the product flow, contractual arrangements and financial payments between the myriad of entities involved with pharmacy distribution in the U.S.

Specialty Pharmacy Trends & Drivers of Specialty Pharmacy Spend

A good part of the presentation covered specialty pharmaceuticals, which are growing at a CAGR of 17% as more products are being developed to treat orphan diseases and provide newer therapies. Some specialty pharmacy trends include:

  • As more specialty drugs are dispensed, a shift away from the buy-and-bill system (reimbursement through medical benefit) to the pharmacy (reimbursement through prescription drug benefit) can be expected.
  • As SPs gain more revenue and market share, they’ll come under more scrutiny and attempts at cost containments from payers.
  • The healthcare system’s grudging acceptance of high-priced orphan disease drugs has given manufacturers more incentive to develop low-volume SP drugs.
  • The high cost of SP’s will demand more Value-Based/Outcomes-Based evidence

Pharmacy Cost Management StrategiesRising pharmacy costs trends specialty pharmacy Management Strategies Distribution Reimbursement System Provider Administered, Outpatient Prescription Drugs

The Cumberland presenters provided an overview of traditional Strategies to Manage Rising Pharmacy Costs and then dived into a LOT of detailed information on the pros and cons of newer, novel strategies for managing pharmacy costs including:

  • Comprehensive Medication Review / Medication Therapy Management
  • Specialty Pharmacy Coordination & Management
  • Outcomes-based Contracting
  • ‘DIR’ Fees – Direct and Indirect Reimbursement

The Future – Pharmacy Trends and Government Intervention

This rapid paced presentation moved toward its conclusion with Pete Biagioni sharing a few slides listing some ways that government intervention might impact prescription drug prices. And the webinar completed with a short listing of future trends for prescription drugs in the U.S. The entry of Amazon and mega deals like CVS buying Aetna being two likely major impacts.

The Recording, The Content and More Insight from Cumberland Consulting Group

The above is just a portion of the information presented by our sponsor partner Cumberland Consulting Group. You can learn more about “Strategies to Address Rising Pharmacy Costs” by reviewing the entire recording of the webinar available here.  If you’d like more information or if you have any questions on the content of this webinar, please feel free to contact Cumberland Consulting Group. You may also want to follow Cumberland on Twitter.

*Per CMS 2014  fact sheet: https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/nhe-fact-sheet.html

 

A Unique Event and Exclusive Group for Healthcare Executives

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Our 2017 Annual Forum came to a close at noon this past Wednesday. Over 110 healthcare executives, nationally known healthcare speakers and industry thought leaders gathered in Nashville, TN – Music City and the Healthcare Capital of the United States – to share their insight, ideas and concerns about healthcare reform and digital transformation during these rapidly evolving, uncertain times in healthcare.

The 29th Annual Forum featured three keynote speakers, nine sessions covering the latest topics of interest to executives leading health plans and health systems and three nighttime events structured to support networking between forum participants. All in all, the two and half days of our 2017 Annual Forum added up to one incredible opportunity for those leading the digital transformation of healthcare reform in the United States to come together on an intimate basis , to share and learn with each other collaboratively.

The 2018 HCEG Top 10 List

As has taken place during each of the last seven HCEG Annual Forum events, participants selected and voted on the Top 10 Opportunities, Challenges and Issues facing health plan and health system executives over the coming months and year. This new 2018 HCEG Top 10 list will drive the focus of Executive Leadership Round Tables, webinars, content development and other collaborative opportunities throughout the remainder of 2017 and the coming new year.

What We’ll Be Sharing From Our 2017 Annual Forum

Over the next few weeks, insight, ideas, opinions and concerns generated during the forum will be shared with members and the public at large. We’ll recap forum speaker and participant insight and opinion into how healthcare in the United States will be impacted by healthcare policy reform, digital transformation initiatives and both national and state-level actions. Readers of this blog, our friends on social media, attendees of our webinars and round tables and subscribers to our newsletter can look forward to how speakers, panelists and participants at our 2017 Annual Forum shared insight on the following:

  • How Clinical and Data Analytics leverage clinical evidence to segment populations, manage health and drive decisions
  • How the emergence of Population Health Services Organizations are operationalizing population health strategy, chronic care management, driving clinical integration, and integrating social determinants of health
  • How Value-Based Payments are being used to target specific medical conditions to manage cost and quality of care
  • How Cost Transparency is inevitable due to growing legislation and consumer demand
  • And more certain topics that can help healthcare leaders address transformation during these uncertain healthcare times

How We’ll Share

The Healthcare Executive Group will share the following via its web site, blog, social channels – including Twitter, LinkedIn an Facebook, and via other channels including member LinkedIn accounts, sponsor partner media and healthcare industry media. Look for the following:

  • Quotes from Keynote Speakers & Panelists
  • Session recaps including Presentation Materials
  • Thoughts from Forum Participants including social media shares
  • Audio Soundbites
  • Pictures and more

How to Stay Connected

To have this valuable information pushed to you, subscribe to our newsletter, follow the Healthcare Executive Group on LinkedIn, Twitter and Facebook; and consider becoming a member of our unique organization of Healthcare Executives. Learn more about the Healthcare Executive Group here.