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What strategies are payers and employers using to cover orphan drugs? – Health Economist

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This is the question asked in a recent article by the author Lopata et al. (2021 year)… Authors interviewed 26 payers (e.g., national, regional, local Medicaid and Medicare plan managers; payers of integrated service delivery systems; pharmacy benefit managers (PBM) and 11 employers (e.g. large employers, employee benefit consultants, employers) Respondents were informed that orphan illness is defined as “a condition affecting fewer than 200,000 people in the United States.”

Most payers used insurance (42%), gene therapy exclusion (31%), or orphan drug withdrawal (23%). While employers also favored the use of reinsurance (55%), the use of exemptions was rare, and switching from health insurance to pharmacy insurance (36%) or exemptions from benefits (27%) or third-party subscription models (27%) were more common. … …

Are restricted distribution networks the answer? Payers didn’t think so.

More than three quarters (76%) of respondents indicated that limited distribution networks impede management, and only 4% indicated that they are improving management.

Another key question is whether orphan drugs taken by a health care provider (HCP) are covered under a health or pharmacy benefit. There are reasons for both.

The main factors that brought HCP’s orphan drug payers’ coverage to health benefits were point of care policy (55%), lower drug costs due to the average selling price (ASP) (50%), preference for network providers (35%) and patient solvency (20%). The main factors that made payer’s coverage of HCP managed products beneficial to the pharmacy were improved ability to manage product (71%), discounts (62%), ability to attract resources from specialized pharmacy providers (SPP; 57%). hospital policies (52%), improved data granularity (38%), preference for network providers (38%) and patient availability (24%) …

We should welcome the development of new treatments for rare diseases as these patients need treatment. At the same time, payers and employers are likely to continue to explore creative strategies to make coverage for this treatment affordable.

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