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Consumer-Directed Health Insurance Plan Growth Levels Off Among Employers

Armen Hareyan's picture

Predictions that consumer-directed health plans such as health savings accounts would continue their steep growth appear to be overstated according to a national survey of health plan sponsors covering between 1,000 and 15,000 lives.

In fact, the survey shows that most employers and health plan sponsors of this size are not considering offering CDHPs as a benefit option in the next few years.

While approximately one in four organizations (24 percent) polled indicated they currently offer a CDHP option, of those that don't, only 11 percent intend to adopt such an option within the coming three years, based on the survey's results released today by Medco Health Solutions, Inc.'s Systemed Group. The survey also revealed that many plan sponsors do not agree with the CDH savings proposition. More than half (53 percent) believe CDH plans are the approach least likely to have an impact on controlling their organization's prescription drug costs, as compared to generic and mail-order strategies and disease management approaches. Additionally, nearly 30 percent believe that CDH plans will do more damage by discouraging patients from getting the care they need.

The national peer study was conducted by ReedHaldyMcIntosh for Medco's Systemed Group. The research firm polled 200 plan sponsors with 1,000 to 15,000 employees including private and public sector employers and labor unions to gauge their perspectives on prescription drug cost control measures they currently use, and those they plan to employ in the future.

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"This survey indicates that for this particular size audience, the bloom may be off the proverbial consumer-driven health rose," said Mike Romanzo, R.Ph, president of Medco's Systemed Group. "Health care consumerism isn't a flawed theory, and for very large employer groups it may be a valid plan offering. But for now, educating members to be savvier shoppers within more traditional prescription plan designs seems to be the route of choice for the majority of our plan sponsors."

Promoting generic drugs is one approach that plan sponsors agree will make a difference; nearly 70 percent of respondents believe stronger incentive programs, including those that require or encourage the use of generics, will have the greatest impact on controlling plan costs - a reflection of the $49 billion savings boon that lies ahead with the pending patent expirations for a number of blockbuster prescription drugs in the next few years. Virtually every plan sponsor (98 percent) currently employs methods that encourage the use of generics and plan preferred brands, while 90 percent also utilize strategies that promote the use of mail order pharmacies.

In 2007 alone, 10 brand-name medications with revenue exceeding $8.1 billion are expected to lose patent exclusivity. The widely prescribed sleep medication Ambien and the popular antihypertensive Norvasc were the first two blockbuster medications to reach the market in generic versions this year.

"The potential opportunity presented by the collection of pending generic blockbusters is not lost on plan sponsors - they see the possibilities, understand the impact on their drug costs, and are planning to take full advantage when those billions of dollars in savings become available," said Romanzo.

Further details on these and other survey findings will be published in the report, The Nine Leading Trends in Rx Plan Management. Some additional survey highlights include: