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  • These are the topics we will cover today. As you see, this presentation will provide data on:the current challenges with the underinsured, healthcare costs in general, how the dynamic insurance environment is impacting the problem and some of PAN’s own data to show how these environmental changes are impacting our bottom line.While this presentation will provide some data, there are still holes in the data that is available around the underinsured and co-payment assistance. PAN has defined as one of our strategic goals to partner with other organizations that have this expertise and interest. If you have contacts at any organizations that might be a good candidate for a partnership, please let Julie know.
  • Pharmacy costs are the largest portion of the out-of pocket expenses that patients must cover. Pharmacy costs are also the fastest growing component of out-of-pocket expenses. Pharmacy costs are expected to increase for several reasons: According to IMS Health’s Global Oncology Forecast, cancer drug costs are expected to increase by 12-14% per year through 2012. Cancer drugs alone account for 17% of the market. According to the Millimian Index, the adoption rate of generic drugs has slowed. Very few high-volume drugs will see their patents expire in the next several years. Lipitor is the next really high-volume drug that will see its patent expire. However, this is not due to occur until 2010. However, this generic drug trend may be mitigated by the increasing push by insurance companies to shift more of the pharmacy burden to the patient. This trend may actually increase the adoption of generics by the consumer. There is also an increase in utilization of specialty type drugs. In addition to the cancer medications, the anti-coagulants and inflammatory medications, like for rheumatoid arthritis and multiple sclerosis, are becoming more widely used.
  • Although everyone is getting squeezed from multiple directions, we believe that if patients can get their medications paid for, that the rest of the cost burden can be managed by patients or may be waived by the physician or the hospital.So, we think that co-payment assistance is one piece of the healthcare puzzle that makes the difference between patients living and dying.
  • Now we will switch gears a bit and discuss the Patient Access Network or PAN. PAN has been around for nearly 3 years. We have funds in 20 disease states equally split between chronic and oncology funds. These include Crohn’s disease, cystic fibrosis, MS and RA on the chronic side and breast cancer, NHL and Multiple Myeloma on the oncology side. We are especially wanting to expand our disease states in the oncology area into brain, ovarian and prostate cancers.The yearly caps for our disease funds range from $1500 – 7500 per year. Most of the oncology funds have the higher caps. The average used by our patients is around $3300. PAN received our OIG opinion last December. We take compliance very seriously. We have firewalled our Lash operations in Charlotte, NC from the rest of the Lash Group and the Amerisource Bergen Company to eliminate any perception of a conflict of interest. We have hired a PAN executive director and we have moved our headquarters to the Washington DC area. Also, we are getting ready to bring a compliance capability on board to continue to monitor the OIG opinion.We are pleased to note that PAN has helped nearly 50,000 patients since our start in 2004.

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  • Approaches to Helping the Under-Insured
    September 2008
  • Agenda
    Sharing Perspectives on Helping the Under-Insured:
    • A Patient
    • A Co-Pay Assistance Non-Profit
    • An Insurance Company
    • A Physician
    • A Pharmacist
    • Questions?
    Page 2
  • A Patient’s Perspective
    Page 3
    Judy Hodges
    Breast Cancer Patient
  • A Patient’s Perspective
    Page 4
    “I sat in the oncologist’s office and kept saying, I don’t have the money , but I’m not going to die because I can’t pay for this. I am not going to die because I am underinsured.”
    Judy Hodges, PAN Patient
  • A Non-Profit Perspective
    Page 5
    Julie Reynes
    Patient Access Network Foundation
  • Why Co-Payment Assistance?
    Pharmacy cost trends upward exceeded all other components
    of medical care from 2007 - 2008.
    Source: 2008 Milliman Medical Index
    Page 6
  • Why Co-Payment Assistance?
    • Prescription drugs have the largest co-payments
    • Prescription drug costs are estimated to continue increasing in the near term
    • Physicians and hospitals have the flexibility to reduce or waive their fees for lower income patients
    • If a patient can obtain the thousands of dollars it may cost to access their medications, they will be more likely to get treatment
    ‘We found that reductions in drug copayments increased medical adherence.’ Michael E. Chernew, Health Affairs, Jan-Feb 2008
    Source: 2008 Milliman Medical Index
    Page 7
  • Patient Access Network
    • A 501(c)(3) public charity that launched our initial assistance program in October, 2004.
    • Currently supports 20 disease-state funds for oncology and chronic diseases.
    • Provides co-pay assistance of from $1500 - $7500 per year for medications.
    • Received favorable advisory opinion from the Office of the Inspector General (OIG) of the Department of Health and Human Services in December 2007.
    • Have approved nearly 50,000 patients for cost-sharing assistance.
    Dedicated to improving access to needed health services for insured patients who cannot afford the out-of-pocket costs associated with their treatment.
    Page 8
  • The Need for Co-pay Assistance from PAN is Increasing
    Demand is increasing by over 30% each year, while revenues remain stable
    Source: Patient Access Network Data, 2004 - 2007
    Page 9
  • An Insurance Company’sPerspective
    Page 10
    Gary Owens
    Physician and Consultant
    Providing the Insurance Company’s Perspective
  • Biotech Drugs as a Growth Area
    Biotech Drugs in Development
    Source: BCBSA Medical Cost Trend Report 2007
  • Biotech Drugs as a Growth Area
    Biotech Drug Spending
    Sources: CMS National Healthcare Expenditure Projection 2003-2013
  • What Does This Mean to a Plan?
    In 2007 Specialty Pharmacy spend was approximately 11.4% of total pharmacy spend (and was over 1/3 of the total trend driver)
    The year over year specialty trend was 12.3%
    Unit cost was responsible for 8.4% with utilization making up the other 3.9%
    Top three categories of specialty drug spending:
    Autoimmune diseases (Rheumatoid arthritis, Psoriasis, Lupus)
    Multiple sclerosis
  • Biotech Drugs and the Health Plan
    Health plans recognize that new drugs and new uses of existing drugs are creating revolutionary treatment advances.
    Coverage of drugs is essential and important for any health benefit plan.
    Purchasers are looking to plans to manage costs or pass excess cost on to the consumer
    Balancing the need of the purchaser with the needs of the consumer is difficult
    Not creating access problems for members is important.
    But so is keeping the plans affordable.
  • Disease Specific Examples of Drug Cost
    Sources: 2008 Medco Drug Trend Report, Specialty Pharmacy News, October 2006
  • The Issues for Plans
    Page 16
    • As cost of therapy increase, the cost of providing care also increases
    • With purchasers pressure on controlling costs, plans have looked for new ways to involve patients in the management of costs.
    • However increasing co-payments and moving drugs to co-insurance tiers have brought about access issues for some patients
    • Plans increasingly look to external resources to assist members get access to care
  • Plan Assistance to Members
    Plans provide case managers to work with patients
    These case managers can do any or all of the following:
    Educate members about the medication and the need for compliance
    Help the patient access benefits in the most cost effective way
    Help the patient discuss treatment options with their physicians and perhaps find less costly, yet clinically effective treatments
    Help the patients locate sources of financial assistance
    Inform physicians of plan benefits and options for members.
    Remember, we are all in this together and the goal of patients, physicians and plans is to provide access to high quality, yet affordable care.
  • A Physician’s Perspective
    Page 18
    Allan B. Goldstein, MD
    Physician and Consultant
  • The Problem of Financial Barriers
    Page 19
    Office Visit Co-Pay
    • $30 – 50 out-of-pocket for each office visit
    • For weekly visits, $120-200 per month, $1,500-2,600 per yr
    Oral Medication Co-Pay
    • Higher co-pay for brand (tier 2) and non-preferred (tier 3) meds
    Parenteral Biologics
    • Increasingly subject to 20% co-insurance (tier 4)
    • Yearly costs for biologics may reach $100,000 or more
    • Co-insurance may be $20,000+ per year
  • Medicare Prescription Drug Coverage (Part D)
    Page 20
    • Premium: $0-100+ per month
    • Deductible: $275 per year
    • Coinsurance: $559 (25% of first $2,510)
    • “Donut Hole”: $3,216 (no coverage $2,510 to $5,726)
    • Total Out-of-Pocket $4,050 excludes monthly premium
    • “Catastrophic” Coverage: patient pays 5% of any expenses over $5,726
    Total Out-of-Pocket = Lots!
  • The Scope of the Problem
    Page 21
    Some Specialties Impacted:
  • The Scope of the Problem
    Page 22
    Some Diagnoses Impacted:
    Breast Cancer
    Colorectal Cancer
    Cutaneous T-Cell Lymphoma
    Lung Cancer
    Multiple Myeloma
    Myelodysplastic Syndrome
    Non-Hodgkin’s Lymphoma
    Pancreatic Cancer
    Rheumatoid Arthritis
    Psoriatic Arthritis
    Ankylosing Spondylitis
    Crohn’s Disease
    Cystic Fibrosis
    Multiple Sclerosis
    Gaucher’s disease
    Growth Hormone Deficiency
  • Physician Responses
    Page 23
    • Absorb the co-pay
    • Collect the co-pay up front
    • Refer to hospital or clinic
    • Stop providing infusion services in the office
    • Employ sub-optimal treatment regimen
    • Hire staff to conduct financial evaluation
    • Identify and counsel patients unable to meet out-of-pocket requirements
  • Consequences for Patients
    Page 24
    • Disruption of the patient/physician relationship
    • Increased travel and inconvenience
    • Financial stress or distress
    • Failure to take medications
    • Sub-optimal treatment
    • Clinical deterioration and/or disease process progression
    The underinsurance challenges may negatively impact the patient’s health.
  • A Pharmacist’s Perspective
    Page 25
    Edith Rosato, PharmD
    Senior Vice President, Pharmacy Affairs
    and National Association of Chain Drug Stores
  • National Spending on Healthcare
    Cost increases for hospital outpatient services and prescription drugs continue to outpace those for inpatient and physician services.
    Annual Per Capita Percentage Change in Health Care Spending, by Category of Service, 2001-2006
    Source: Bradley C. Strunk, Paul B. Ginsburg, and John P. Cookson. "Tracking Health Care Costs: Declining Growth Trend Pauses In 2004." Health Affairs Web Exclusive, June 21, 2005; and Ginsburg, Paul B., Bradley C. Strunk, Michelle I. Banker, and John P. Cookson. "Tracking Health Care Costs: Continued Stability But At High Rates In 2005." Health Affairs Web Exclusive, Oct. 3, 2006.
  • The Underinsured: Coping With Rising Prescription Drug Costs
    Represent 25M in 2007 and rising
    72M or 41% of working-age adults have problems paying medical bills
    29% unable to pay for basic necessities
    39% use savings
    30% take on credit card debt
    46% skimp on medications
    33% compared to 19% of adequately insured used ER
    The uninsured population compounds this issue
    Sources: The Commonwealth Fund, Biennial Health Insurance Surveys, August 2008
  • The Current State of Medication Adherence in the U.S.
    Estimated annual costs to the healthcare system: $177B
    Only 50% of patients take medications as prescribed
    Reasons for non-compliance:
    Denial of the illness
    Misunderstanding of the directions
    Lack of understanding of the disease
    Lack of symptoms
    Impact of chronic disease:
    130M patients (45% of population); 7-10 deaths annually
    $1.3 Trillion annual drag on economy
    Represents 91% of all prescriptions filled
    The Result is a
    Significant Public Health Crisis
    Sources: National Council on Patient Information and Education, “Enhancing Prescription Medicine Adherence: A National Action Plan”. August 2007
  • Community Pharmacy Response
    Many chains have introduced prescription savings
    programs to assist the uninsured or underinsured
    Covers prescription brand and generic drugs, preventative and lifestyle drugs, vision, dental and hearing…even pet meds
  • Other Discounted Drug Programs and Financial Assistance Programs
    HealthCare Club of America
  • Retail Clinics
    Health and wellness destination
    Offers affordable healthcare
    One-stop shopping convenience
  • Government Programs
    Health Resource Services Administration 340B Program
    Safety Net Clinics
    Medicare Part D: Covering the “donut hole” patients
    SCHIP: America’s Promise Alliance and All Kids Covered
  • Healthcare Reform Debate: Opportunity to Advocate for Patients
    High quality, affordable and accessible healthcare coverage should be the goal of any reform proposal
    Cost-sharing, such as patient co-pays, should be set at affordable levels and not prevent patients from seeking appropriate medical care
    Patients should have access to the most cost-effective medication to treat their condition
    Lower cost, equally effective generic medications should be encouraged
    Preventative services such as medication therapy management should be encouraged
  • Role of the Pharmacist
    Convenient, highly accessible community based health resource for patients
    Pharmacists are knowledgeable about available programs for uninsured and underinsured patients
    Encourage patients to utilize and interact with their pharmacists
  • Conclusions
    Page 35
    • Patients are making life or death decisions based on their ability to pay for healthcare
    • Each healthcare component is trying to help in its own way
    • Medication costs are a large component of the challenge.
    • Each healthcare component has constraints imposed by the government, stockholders, funding, etc.
    • Many challenges remain
    • Healthcare reform is likely to create new challenges