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New Insurer Perspectives Highlight Considerable Patient Challenges Anticipated from Prescription Drug Affordability Boards

April 2, 2024 (Washington, DC) Today the Partnership to Fight Chronic Disease (PFCD) released a new white paper, “Health Plans Predict: Implementing Upper Payment Limits May Alter Formularies and Benefit Design But Won’t Reduce Patient Costs,” which details feedback from executives of six different health plans insuring nearly seven million lives with direct prescription drug affordability board (PDAB) implementation experience. The findings in the paper resulted from in-depth interviews conducted by Avalere. Two of the six health plans have direct experience in Colorado.  
Along with several stakeholders across patient communities, PFCD is working to elevate concerns about the potential negative impact PDABs will have on people living with chronic diseases and their access to medications. While proponents of PDABs claim they will lower costs and improve access to medicines for patients, this research demonstrates that even insurers are dubious about those claims.
The Colorado PDAB is tasked with setting an upper payment limit (UPL) for drugs it deems “unaffordable” in the state. A UPL affects insurers and PBMs directly, not patients.  Insurers, PBMs and other payers, in turn, will continue to make the decisions about what patients pay out-of-pocket and any conditions patients must meet for coverage like requiring step therapy or prior authorization. The white paper presents payer reactions to UPLs and anticipated shifts in plan benefit design, and importantly, how these changes will impact patient access and costs. The paper also notes insurer perspectives on how providers who purchase medicines, including physicians who buy and administer drugs, will be affected given the financial risks of spending more on a medicine than a UPL will allow them to be reimbursed.
Insurers confirm what patient advocates fear: UPLs will not lower patient costs and will increase barriers to access. The white paper includes insurer feedback related to the impact on plan benefit design, patient cost sharing, provider reimbursement, and contracting and reimbursement changes due to a UPL. The paper also includes several recommendations for ways to lower costs for people living with chronic illness and assuring greater transparency and patient advocate participation in the PDAB consideration processes.
“Having health plans confirm that patients are likely to experience greater barriers to access across classes of medicines and will not see lower premiums or other out-of-pocket costs is a clear red flag related to PDAB efforts,” stated PFCD Chair Ken Thorpe. “While many share the goal of lowering patient costs for drugs, accomplishing it must focus directly on costs to the patient, not the payer. Comprehensive and sustainable solutions that facilitate patient access to recommended care would improve health outcomes and lower the burden of illness for patients and the system overall.”
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