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Health Plans' Coverage of Specialty Drugs Shows Wide Variation, Study Finds

Allison Inserro
There is widespread variation in how commercial insurers cover specialty drugs, a recent Heath Affairs study found, with only 16% of the drug-indication pairs examined covered the same way. Fewer than half were covered consistently by at least 75% of the plans.
There is widespread variation in how commercial insurers cover specialty drugs, a recent Heath Affairs study found, with only 16% of the drug-indication pairs examined covered the same way. Fewer than half were covered consistently by at least 75% of the plans. Specialty drugs now make up about 41% of pharmacy spending and cost, on average, about $3000 a month.

The study was funded by the National Pharmaceutical Council (NPC), and one of its executives was an author. The researchers used information from Tufts Medical Center’s Specialty Drug Evidence and Coverage Database, a database of health plans’ specialty drug coverage decisions developed by other study authors.

A statement from the NPC said the study has implications for both patients and providers. 

“Variation in coverage may substantially influence patient access to specialty medicines,” explained author Jennifer Graff, PharmD, vice president of Comparative Effectiveness Research at the National Pharmaceutical Council. “For patients switching between insurers or employers, differences in plans’ coverage decisions may result in care disruptions. It also requires that physicians tailor care not only to diverse patients, but also to the multiple insurance plans that provide healthcare coverage.”

The Tufts database includes 302 drug-indication pairs, corresponding to 3417 coverage decisions. If a drug is approved for more than 1 indication, it is listed separately for each indication it covers.

“We found that even if a drug was covered, many treatments had multiple restrictions prior to patients being able to access these medications,” said James Chambers, PhD, MPharm, MSc, lead author of the study and associate professor of medicine, the Center for the Evaluation of Value and Risk in Health, Tufts Medical Center.

For insurance information, it includes data from 17 of the 20 largest commercial plans, in terms of premiums earned. Each coverage decision was compared with the corresponding FDA-labeled indication covering 5 categories:
  • Less restrictive—the plan covered the drug for a broader patient population than the FDA indication (8.5% of the time)
  • Consistent with the FDA label—(52% of the time)
  • More restrictive—the plan placed conditions on coverage beyond those in the FDA indication (about 33% of the time)
  • Mixed—coverage was more restrictive in 1 way but less restrictive in another (2.2% of the time)
  • Not covered at all (about 5% of the time)
Health plans added fewer restrictions for specialty drugs indicated for cancer, orphan diseases, and pediatric populations, as well as drugs without safety warnings, drugs on the market for longer periods of time, drugs without alternatives, and drugs approved through the FDA’s expedited review program.

Diseases with multiple drug alternatives tended to have more restrictions, possibly because plans consider drugs in the same therapeutic class to be equally effective and prioritize patients’ access to 1 or 2 of those drugs. For instance, plans restricted access to drugs for rheumatoid arthritis in roughly 75% of cases.

“Ideally, coverage should be evidence based, and the rationale underlying coverage decisions should be transparent and publicly available,” the authors wrote.

The study also looked at the various coverage requirements that plans put in place before covering a drug—for example, step edits or prescriber restrictions were most common restrictions used.

The authors suggested a number of potential explanations for their findings.
  • Plans negotiate different discounts with manufacturers or have different contracting arrangements;
  • Plans tailor decisions to specific populations;
  • Plans have different available financial resources;
  • Plans use different criteria on which to base their coverage decisions—for example, some may consider cost effectiveness analyses.
“Because of budgetary pressures and the availability of alternative treatment options for many drug classes, it is unsurprising that health plans negotiate preferred treatment status for larger manufacturer rebates,” the authors wrote.

Other health policy research that looks at plans’ evidence requirements and differences in decision-making criteria would be valuable, the authors concluded, and greater transparency would help patients and physicians better understand these decisions.


Chambers JD, Kim DD, Pope EF, Graff JS, Wilkinson CL, Neumann PJ. Specialty drug coverage varies across commercial health plans in the US. Health Aff (Millwood). 2018;37(7):1041-1047. doi: 10.1377/hlthaff.2017.1553

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