EMPLOYER MARKET
INSIGHTS REPORT 2020 THIRD EDITION
MAGELLAN RX EMPLOYER MARKET INSIGHTS REPORT / 2020
1
TABLE OF CONTENTS Employer Market Trends
2
Keeping an Eye on 2021
2
Traditional Pharmacy Trends
3
Specialty Pharmacy Trends
4
Clinical Case Study
5
Editorial and Design Staff STEPHANIE STEVENS, MPH Director, Marketing
JENNIFER BOSTICK
Senior Graphics Designer
BROOKE KACHURA Director, Marketing
Contributors EARL HURST
KAYLA HIRSCH
KARIM PRASLA
ALEX BARATZ, PHARMD
TROY PHELPS
SAGAR MAKANJI, PHARMD
Senior Vice President, General Manager, PBM Market Vice President, Clinical Outcomes, Analytics and Reporting Senior Director, Analytics
Vice President, Marketing
KATIE LOCKHART
Manager Forecasting and Pharmacoeconomics
Senior Director, Clinical Pharmacy Programs, MTM
Vice President, Clinical Strategy and Programs
Forecasting powered by
MRxPredict ©2020 Magellan Rx Management, LLC. Magellan Rx Management 2020 Employer Market Insights Report™. All rights reserved. All trademarks are the property of their respective owners. The content — including text, graphics, images, and information obtained from third parties, licensors, and other material (“content”) — is for informational purposes only. The content is not intended to be a substitute for professional medical advice, diagnosis, or treatment. Figures may be reprinted with the following citation: “Magellan Rx Management Employer Market Insights Report™, Third Edition, ©2020. Used with permission.”
1
MAGELLAN RX EMPLOYER MARKET INSIGHTS REPORT / 2020
EMPLOYER MARKET TRENDS Welcome to the 3rd edition of the Magellan Rx Employer Market Insights Report. This one-of-a-kind report highlights the key insights that matter to your business, including:
Looking forward, overall trend for 2020 and 2022 are expected to be on par with previous years, around 5%, but the 2021 trend looks to be lower than average at 2%. In 2022, traditional trend is expected to be positive, although lower than overall trend.
• Three-year overall drug trend forecast across traditional and specialty pharmacy • Key conditions to watch • Main drivers of drug trends
Cost share continues to be supported by plan sponsors with an 80%/20% split in traditional. Health plan sponsors support 95% of the cost share in specialty, but the member out-of-pocket cost burden is 16 times that of traditional drugs. Utilization was a major driver of both traditional and specialty trend. Even so, the overall trend impact was mitigated due to enhanced cost management strategies. Trend Drivers illustrate that specialty trend continues to outpace traditional trend, primarily due to increased utilization and inflation costs.
Keeping an Eye on 2021 The 2019 overall drug trend was well managed, experiencing a decrease in trend and symbolizing a high level of cost savings. Overall cost savings were primarily weighted by the traditional category where there was a 9% decrease in trend. Although the specialty trend was positive, it was less than 1%, symbolizing a highly managed trend for specialty drugs.
DRUG TREND Traditional
COST SHARE TRADITIONAL DRUGS
13.1%
Overall 9.4%
Specialty 6.6%
2.4% -0.3%
3.5%
2.6% 0.7%
-0.04%
-1.1% -1.1%
2021
0.6%
-1.4%
Traditional Specialty -8.2%
Avg. OOP Cost per Claim $12.92 2020
2.3%
-1.4%
-8.6% 2019
5.3%
Member 5% Pla n or 95% ons Sp
2.0%
0.7%
-4.4%
Pla n
5.5%
SPECIALTY DRUGS
or 81% ons Sp
5.0%
Member 19%
TREND DRIVERS
2022
Methodology and Disclaimer All forecasts are based on MRx methodology to project financial impact for years 2019, 2020, 2021, and 2022. Forecasting information is for informational purposes only. This report is based on the following methodology: • Specialty drugs include only those covered on the pharmacy benefit and are based on MRx specialty definition. • Cost per claim is based on average wholesale price (AWP); cost = employer liability after cost share). • Overall drug trend and forecast is based on plan paid per member per month (PMPM) change year over year after rebates and network discounts.
Avg. OOP Cost per Claim $219.45
-11.0% Consumers
Consumption
Utilization: Traditional 2.2% Specialty 7.9%
Cost Share
Pricing
Inflation
Drug Mix
Unit Cost: Traditional -10.8% Specialty -8.2%
• Specialty drug trend and forecast is based on plan paid PMPM change year over year after rebates and network discounts; individual condition drug trend and forecast is prior to rebate impact but includes network discounts. • Traditional drug trend and forecast based on plan paid PMPM change year over year after rebates and network discounts; individual condition drug trend and forecast is prior to rebate impact but includes network discounts. Utilization divided into consumers (utilizers) and consumption (days, supply per utilizer).
MAGELLAN RX EMPLOYER MARKET INSIGHTS REPORT / 2020
2
TRADITIONAL PHARMACY TRENDS FORECAST
KEY CONDITIONS FORECAST 2019
Traditional spend is predicted to be well controlled over the next two years and have a negative trend. In 2022, the trend will bounce back to positive with a few categories leading the way.
2020
2021
2022
ASTHMA/COPD
• M igraine will only constitute between 0.8% of the benefit spend in 2019 and 1.4% of benefit spend in 2022, but the category trend was 50% for 2019 and 2020. Although trend will greatly reduce in 2021, it will still be close to two times the trend of the next highest key condition, depression.
2.9% 6.8% 1.6% 5.9%
• D epression had a negative trend in 2019, but will have the next highest trend of almost 8% in 2021 and will double that trend in 2022 in anticipation of the robust pipeline. DEPRESSION -6.2% 4.0% 7.5% 15.2%
DIABETES
TRADITIONAL DRUG TREND
13.3%
MIGRAINE - CONDITION TO WATCH
9.4% 4.3% 7.2%
2.4%
-0.3%
DYSLIPIDEMIA
-1.4%
49.4%
52.7%
-12.7% -8.0% 0.6% 6.8% 13.7%
13.7%
2021
2022
-8.6% 2019
2020
2021
2022
2019
2020
MIGRAINE 49.4% 52.7% 13.7% 13.7%
SEIZURE -12.1% -13.2%
-1.0% 0.6%
3
MAGELLAN RX EMPLOYER MARKET INSIGHTS REPORT / 2020
SPECIALTY PHARMACY TRENDS FORECAST
KEY CONDITIONS FORECAST 2019
2020
2021
Specialty trend in spend was low for 2019 due to unit cost management strategies, but is expected to be double digits in 2020. The forecasted trend of 7% and 9%, although expectedly higher than traditional, is on par or below previous years, indicating cost containment strategies are effective in controlling trend.
AUTOIMMUNE - ANTI-INFLAMMATORY
Key conditions in the specialty market are stable. Autoimmune, HIV/AIDS, multiple sclerosis, and oncology continue to be the key drivers of trend for specialty. Whereas last year, autoimmune was the key condition to watch, this year, oncology trend is at the forefront with a robust oncology pipeline and continued increased cost of therapies.
7.5% 9.7%
• Oncology trend will be between 7% and 8% over the next three years with PMPM projected to be $4.80, or 6% of total spend, and projected to $6.04 in 2022, or 6.5% of total spend.
2022
15.9% 20.0%
Member OOP $305
CYSTIC FIBROSIS 19.5%
• Autoimmune is still a key category as it currently has double digit trends and is forecast to have 7% and 9% trend by 2022. Beyond 2022, additional cost cost savings opportunities are expected with the potential increased availability of biosimilar agents.
30.7% 8.9% 11.3%
Member OOP $118
HIV/AIDS
SPECIALTY DRUG TREND
ONCOLOGY - CONDITION TO WATCH
4.3% -1.3% 1.9% 2.3%
8.8%
13.1%
7.7%
7.4%
MULTIPLE SCLEROSIS -1.5%
9.4%
3.7% 1.0%
6.6%
5.3%
0.7% 2019
-1.4%
2020
Member OOP $174
2021
2022
2019
Member OOP $270
ONCOLOGY 2020
2021
2022
-1.4% 8.8% 7.7% 7.4%
Member OOP $55
MAGELLAN RX EMPLOYER MARKET INSIGHTS REPORT / 2020
4
CLINICAL CASE STUDY In 2022, as illustrated previously, spend will continue to increase for both the traditional and specialty benefit. Even so, this forecast is a projection, and proper management of key conditions can positively affect trends and produce meaningful cost savings. The following case study illustrates a recent quality and costsaving program for members with diabetes, a key traditional condition that historically yields a positive trend. Through the use of multi-modal outreach, including digital engagement, the program was able to identify and address key gaps in case management and generated greater than a four-to-one return on investment (ROI) for the employer group.
SITUATION
SOLUTION
Customer was seeking solutions to improve outcomes for their members with diabetes via a comprehensive and cost-effective clinical program
Worked with customer to implement a tailor-made program for members with diabetes by utilizing a pharmacist-led team to manage all aspects of diabetes, from improving wellness to maximizing clinical outcomes
RESULTS Hypoglycemia Management
Immunizations
Eye Exam
Gaps/DTPs Addressed
Medication Adherence
Side Eects
ACEi/ARB Initiation
5
HbA1C Monitoring
Statin Initiation
MAGELLAN RX EMPLOYER MARKET INSIGHTS REPORT / 2020
>3
on average GAPS IDENTIFIED PER INTERVENED MEMBER
>4:1 ROI FROM LITERATUREBASED SAVINGS
CONNECT WITH US TODAY! MAGELLANRX.COM
MAGELLAN RX EMPLOYER MARKET INSIGHTS REPORT / 2020
6