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The American Journal of Managed Care March 2016
Understanding Vaccination Rates and Attitudes Among Patients With Rheumatoid Arthritis
Diana S. Sandler, MD; Eric M. Ruderman, MD; Tiffany Brown, MPH; Ji Young Lee, MS; Amanda Mixon, PA; David T. Liss, PhD; and David W. Baker, MD, MPH
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Brian W. Powers, AB; Ashish K. Jha, MD, MPH; and Sachin H. Jain, MD, MBA
Prevalence, Effectiveness, and Characteristics of Pharmacy-Based Medication Synchronization Programs
Alexis A. Krumme, MS; Danielle L. Isaman, BS; Samuel F. Stolpe, PharmD; J. Samantha Dougherty, PhD; and Niteesh K. Choudhry, MD, PhD
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Impact of Cost Sharing on Specialty Drug Utilization and Outcomes: A Review of the Evidence and Future Directions
Jalpa A. Doshi, PhD; Pengxiang Li, PhD; Vrushabh P. Ladage, BS; Amy R. Pettit, PhD; and Erin A. Taylor, PhD, MSPH
Organizational Structure for Chronic Heart Failure and Chronic Obstructive Pulmonary Disease
Seppo T. Rinne, MD, PhD; Chuan-Fen Liu, PhD; Edwin S. Wong, PhD; Paul L. Hebert, PhD; Paul Heidenreich, MD; Lori A. Bastian, MD; and David H. Au, MD
Value of Primary Care Diabetes Management: Long-Term Cost Impacts
Daniel D. Maeng, PhD; Xiaowei Yan, PhD; Thomas R. Graf, MD; and Glenn D. Steele, Jr, MD, PhD
The Budget Impact of Cervical Cancer Screening Using HPV Primary Screening
Thomas Wright, MD; Joice Huang, PharmD, MBA; Edward Baker, MD; Susan Garfield, DrPH; Deanna Hertz, MHEcon; and J. Thomas Cox, MD
National Estimates of Price Variation by Site of Care
Aparna Higgins, MA; German Veselovskiy, MPP; and Jill Schinkel, MS
LDL Cholesterol Response and Statin Adherence Among High-Risk Patients Initiating Treatment
Suma Vupputuri, PhD, MPH; Peter J. Joski, MS; Ryan Kilpatrick, PhD; J. Michael Woolley, PhD; Brandi E. Robinson, MPH; Michael E. Farkouh, MD, MSc; Huifeng Yun, PhD; Monika M. Safford, MD; and Paul Muntner, PhD

Impact of Cost Sharing on Specialty Drug Utilization and Outcomes: A Review of the Evidence and Future Directions

Jalpa A. Doshi, PhD; Pengxiang Li, PhD; Vrushabh P. Ladage, BS; Amy R. Pettit, PhD; and Erin A. Taylor, PhD, MSPH
The authors review published evidence regarding associations between high cost sharing for specialty pharmaceuticals indicated for rheumatoid arthritis, multiple sclerosis, and cancer, and their utilization.
Prescription abandonment. In the 3 eligible studies, prescription abandonment was defined as a reversal of an adjudicated claim for a newly prescribed specialty drug (ie, the prescription was submitted and approved by the insurer but not obtained by the patient, so the pharmacy withdrew [reversed] the claim), with no subsequent paid claim within 90 days of the reversed claim.15,21,26 Prescription abandonment may be thought of as a subcategory of primary nonadherence, which is when a physician prescribes a medication but the patient does not submit, or does not pick up, the prescription from the pharmacy.

All studies reported a strong association of higher cost sharing with abandonment (vs initiation) of specialty drug prescriptions, for all indications examined. In one study among privately insured patients, approximately 25% abandoned their specialty medication when the OOP cost on the claim was greater than $200 for MS specialty drugs and greater than $500 for anti-inflammatory biologics, compared with less than 5% to 6% abandonment rates when OOP  costs on the claim were less than $100.26 A follow-up study using similar, but more recent, data reported that 50% to 60% of privately insured patients abandoned anti-inflammatory biologics and MS specialty drugs when faced with $2000 or more in monthly OOP costs (ie, due to high deductibles) compared with 5% to 6% abandonment rates among patients facing less than $50 in monthly costs; however, it should be noted that only a small percentage (2%-4%) of patients were subject to such high cost-sharing levels.15 Even for oral cancer agents, approximately one-fourth of privately insured and Medicare patients abandoned their specialty medication when OOP cost on the claim was greater than $500 compared with less than 5% to 6% abandonment rates with less than $100 in OOP costs.21 Notably, the cost-sharing burden in this study was higher for Medicare patients relative to privately insured patients (46% vs 11% facing greater than $500 OOP costs), but subgroup analyses were not conducted.

Initiation. Initiation was typically defined as the first-time use of a specialty drug within a study period, among patients with a given disease. We grouped studies that examined any utilization (first time or repeated use) during the study period into this category as well. All studies examining initiation in patients with RA and MS reported a negative association with higher cost sharing. The magnitude of the effect varied across studies, with demand elasticities ranging from –0.03 to –0.33. For example, a 100% increase (ie, doubling) in cost sharing for MS drugs was associated with a 3% to 4% reduction in the probability of initiating these agents in 2 studies,19,29 but was associated with a 33% reduction in initiation in another study.30 Similarly, doubling of cost sharing for RA biologics was reported to reduce initiation by 5%29 to 9%.24 A recent study reported that drug benefit generosity was associated with initiation of RA biologics among the subgroup of patients deemed to have mild-to-moderate disease activity, but not among the subgroup defined as having moderate-or-high disease activity with features of poor prognosis,12 suggesting that disease severity may have been influencing initiation decisions.

Initiation of specialty drugs for cancer, on the other hand, was largely reported to be insensitive to cost sharing in the 3 studies examining this outcome.16,23,29 One study found that cancer patients were 26% less likely to initiate the drug rituximab if cost sharing was doubled (ie, elasticity estimate of –0.26); yet, the same study did not find significant effects for the other cancer drugs it examined.23

Adherence. Treatment adherence was commonly measured by proportion of days covered (PDC), or the proportion of total days in a period that the patient had a supply of medication available. Some studies used a continuous measure of adherence, whereas others classified patients as being adherent (or nonadherent) based on whether ≥80% of the observation days were covered with a specialty drug supply (or not).

The evidence on the relationship between cost sharing and adherence was mixed across all 3 indications. As shown in the Table and eAppendix, findings varied based on the disease condition/drug class, the measure of adherence, and the level and type of cost sharing.13,17,20,22 One study of cancer drugs, for example, measured adherence as both a dichotomous variable (PDC ≥0.80) and a continuous variable (PDC), and found effects for the former but not the latter.13 A longitudinal study examining the effects of co-payment increases in an integrated HMO setting reported no relationship between cost sharing and adherence to MS, biologic anti-inflammatory, and cancer drugs.20 This may have been related to the fact that 84% of the sample faced increases of only $25 to $50. Another study found that higher cost sharing was associated with significantly lower adherence to MS drugs in a subgroup of patients facing coinsurance, but not in a subgroup of patients facing co-payments.22

Discontinuation/persistence. Discontinuation was generally defined as having a continuous gap of time between prescription fills, during which the individual’s specialty drug supply has run out. The number of days used to define a continuous gap varied across studies (30, 45, 60, 90, and 135 days). Persistence was generally characterized as the duration of time between treatment initiation and treatment discontinuation.

Six of the 7 studies reported a statistically significant increase in discontinuation (or decrease in persistence) associated with increased cost sharing for at least 1 of the indications examined. Although the evidence was mixed for MS and cancer drugs, with 2 studies reporting absence of effects, all 3 studies examining biologics indicated for RA showed associations with cost sharing. However, the magnitude of the effects appeared small even among RA biologic users. For example, one study of employer-sponsored plans reported demand elasticity of –0.04 on the probability of continuation of newly initiated RA biologics (doubling the cost sharing was associated with a 3.8% relative reduction in the probability of continuation of the RA biologics, from 0.80 to 0.77), with continuation defined as use in the subsequent year.24

Number of specialty drug claims. Only 1 study examined the association between higher cost sharing and the number of specialty drug claims,23 which is an additional proxy for utilization. Among those patients who initiated therapy, demand elasticity on the number of claims was –0.04 for rituximab (a doubling in cost sharing was associated with approximately a 4% reduction in the number of claims) and –0.11 for other cancer drugs (bevacizumab, trastuzumab, imatinib mesylate, erlotinib).

Drug spending. One study captured spending on specialty drugs via both medical and pharmacy claims and reported varying effects of cost sharing based on the condition examined.29 The demand elasticities ranged from –0.07 to –0.21 (doubling of cost sharing for MS and RA specialty drugs was associated with 7% and 21% reductions in total spending on specialty drugs for those conditions, respectively). However, a similar change in cost sharing was not associated with spending on specialty drugs for cancer. At the same time, the study found that once patients initiated the specialty drugs, cost sharing had no impact on total drug spending among patients with any of the 3 conditions.

Although numerous studies have examined the effects of cost sharing on traditional pharmaceuticals,9,31 comparatively few have examined this issue for specialty drugs. Nevertheless, the literature on this topic is growing, with over half of the 19 studies included in this review published in the last 5 years. In general, findings from these studies revealed that higher cost sharing is associated with reductions in utilization of specialty drugs indicated for RA, MS, and cancer. Yet, the evidence is not consistent; the magnitude and/or statistical significance of the associations varied by type of specialty drug use outcome and by disease.

Higher cost sharing appears to have a stronger association with noninitiation or abandonment of a prescription at the pharmacy, and a somewhat smaller association—or no association—with refill behavior (eg, adherence, number of claims) and with specialty drug spending once patients have initiated therapy. Patients who have already chosen to fill specialty drug prescriptions may be less sensitive to costs because they have a more established understanding of the potential benefits of treatment and/or have already committed to treatment.

Overall, associations between cost sharing and specialty drug utilization outcomes were not as strong as those found for traditional pharmaceuticals.9,31 Based on the few studies in our review where price elasticity of demand estimates were available, price sensitivity for specialty drugs was lower than the –0.20 to –0.60 range reported in a 2007 review of cost sharing for traditional pharmaceuticals.9 By comparison, the studies we reviewed reported elasticities of –0.03 to –0.33 for initiation, –0.04 for discontinuation, –0.04 to –0.11 for number of claims, and –0.07 to –0.21 for drug spending. On the one hand, higher prices for specialty drugs, combined with higher patient cost-sharing levels, may substantially reduce utilization for these medications. On the other hand, the lack of availability of close substitutes at lower OOP costs and the fact that these drugs are often used to treat complex chronic and life-threatening conditions means that patients have few alternatives; therefore, they may decide to pay the cost-sharing amount regardless of its magnitude.

In our review, cost sharing was more likely to show mixed or no associations with many specialty drug utilization outcomes for a life-threatening condition like cancer, as opposed to the relatively more consistent associations for RA. Costs may play a different role in patients’ treatment decisions when a medication is perceived to be a life-saving option. Nevertheless, no matter how high the demand, some patients may be unable to pay in the context of competing obligations and others may purchase medications but subsequently have problems paying for other necessities, face depletion of their financial savings, or even face bankruptcy.32 Such information is not captured in administrative claims, the data source typically used for examining the effects of cost sharing. 

As with any review, our conclusions should be interpreted in the context of our methodological choices. We opted to focus on only 3 disease areas—RA, MS, and cancer—because of their relevance to specialty drug spending and also because they have been the focus of most available studies. A handful of singleton studies have examined specialty drugs indicated for serious infections, HIV, osteoporosis, kidney disease, and transplants, but it is difficult to draw conclusions about such conditions from such a limited research base.20,29,33-35

Limitations of the Evidence Base and Future Directions

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