Managed care market

Research finds hostility against managed care has declined 

Harris Interactive has tracked public attitudes toward managed care for 7 years. In 1995, most people were generally supportive of managed care, but with every year until 2000, hostility and criticism increased and support declined. This period was marked by a “demonization” of managed care in the media, and a growing backlash against it was evident.

However, the backlash seems to have peaked in 2000, declining somewhat since then. In mid-2002, Harris Interactive Health Care News reported that overall attitudes toward managed care had improved a little (and attitudes toward health insurance had improved a lot). The most recent issue, however, found a modest decline in those who are critical of managed care on 2 separate issues:

Although the news is moderately good for the managed care industry, the perception of cost-containment has not improved. A 50% to 34% plurality believes managed care will not help contain costs. Although this gap (of 14 percentage points) is unchanged since 2000 (when a 53% to 39% majority felt this way), the number of those who are not sure has increased from 8% to 16%. Overall, therefore, hostility toward managed care has declined a little since 2000—not because it has made new friends but because more people are not sure what to think.

These new results come from a nationwide Harris Interactive survey of 1011 adults interviewed by telephone between September 19 and 23, 2002. A pdf of the report can be downloaded from www.harrisinteractive.com/news/newsletters_healthcare.asp.

Rising prescription costs plaguing workers' compensation 

Some estimates say the rate of prescription drug costs related to workers' compensation claims have risen 16% annually for the past few years, and reduction is not expected soon. Drug costs now account for 5% to 8% of overall medical spending for workers' compensation, according to David Deitz, national medical director at Liberty Mutual Insurance in Boston.

Employers' attempts to control these costs have been frustrated because workers' compensation law does not allow them to use cost-sharing tools, such as increased copayments and tiered formularies, that have helped stem drug expenditures in group health plans. As a result, employers are turning to prescription benefit managers (PBMs) to lower costs through provider and patient education, among other options.

The rising costs stem primarily from greater use of prescription medicines rather than higher prices of those drugs. Direct-to-consumer advertising has fueled patients' demands for higher-priced, name-brand drugs, which they see advertised on television and in magazines. Famous examples of this trend include Vioxx and Celebrex. Physicians are prescribing these specific brands when patients request them, although less-expensive but effective alternatives may be available.

Experts say the best way to control this surge is to shift focus away from branded medicines to generics. A case in point is Prozac, the generic form of which can cost half as much. Many injured employees become depressed and are prescribed this drug.

Other limitations for workers' compensation management are the facts that injured workers do not share the cost of medications, so multitiered drug plans cannot be implemented, and the workers do not have to use pharmacy networks with which their employer or insurer has contracted to provide discounts.

The appeal of PBMs is that they teach providers and patients about cheaper but effective alternatives to high-end prescriptions, and they review therapy plans and drug regimens to verify they are appropriate for the injured workers' conditions. They also check for drug duplication (a problem that may arise when patients without care coordinators see multiple practitioners and get multiple drugs from them) and may offer and encourage access to discount pharmacy networks.

Business Insurance, Oct. 21, 2002

Free generic prescriptions for plan members 

AdvancePCS is offering a program that provides health plan members with free generic drug prescriptions. Under the AdvanceGenerics program, the Texas-based health services company provides vouchers to allow patients to fill their first prescription of a generic drug at no cost. The program also includes a system that alerts pharmacists to the availability of drugs that are cost-effective and available in generic form. With the patient's agreement, a pharmacist can contact the physician to determine whether a switch from a name-brand to a generic medication is appropriate. The vouchers can be distributed to members by AdvancePCS, their health plans, or their doctors.