Senior Vice President, General Manager, PBM Market
KARIM PRASLA
Vice President, Clinical Outcomes, Analytics and Reporting
TROY PHELPS
Senior Director, Analytics
Vice President, Marketing
ALEX BARATZ, PHARMD
Senior Director, Clinical Pharmacy Programs, MTM
SAGAR MAKANJI, PHARMD
Vice President, Clinical Strategy and Programs
KATIE LOCKHART Manager Forecasting and Pharmacoeconomics
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:
• Three-year overall drug trend forecast across traditional and specialty pharmacy
• Key conditions to watch
• Main drivers of drug trends
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 COST SHARE
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.
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 traditiona t n i a i to in a ti i ation an inflation o t
TREND DRIVERS
and Disclaimer
information is for informational purposes only. This report is based on the following methodology:
• ia t in on t o o on t a a n t an a a on ia t nition
• 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.
TRADITIONAL PHARMACY TRENDS FORECAST
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.
• i ain i on on tit t t n o t n t n in an o n t 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.
• Depression 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.
KEY CONDITIONS FORECAST
SPECIALTY PHARMACY TRENDS FORECAST
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 t a itiona i on a o o io a in i atin o t ontain nt t at i a ti in controlling trend.
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.
• Oncology trend will be between 7% and 8% over the next three years with PMPM projected to be o o tota n an o t to in o o tota n
• 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.
CLINICAL CASE STUDY
In a i t at io n i ontin to in a o ot t t a itiona an ia t n t n o t
a t i a o tion an o ana nt o on ition an o iti a t t n an o anin o t a in o o in
at a nt a it an
t saving 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. on average
SITUATION
Customer was seeking solutions to improve outcomes for their members it ia t ia a o n i an o t ti ini a o a
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
>3 >4:1 ROI GAPS IDENTIFIED PER INTERVENED MEMBER I BASED SAVINGS
