A message on LinkedIn went viral recently. Angie Franks, CEO of Kalderos, posted about her husband’s experience going to the pharmacy to pick up his diabetes medication. In the past, this was a normal errand that cost an affordable $35 copay. But in March, he was slapped with a $965 bill. What happened? Why did the cost suddenly jump 2,600 percent? He didn’t know, and he decided not to buy his medication.
His wife, who works in healthcare, called the insurance company. The insurer said they were not responsible for the decision and gave her a different number to call. She called and learned that GLP1s, including his diabetes medication, had switched benefit classes. GLP1s dropped off the drug benefit and went on to the medical benefit, meaning her husband’s medication no longer qualified for the copay but instead was subject to the deductible. He would have to pay full price for the medication until the deductible was met.
He researched drug coupons and found a good one. It would lower the cost to $300, more than 60% off. But, and it’s a big BUT, the cost would not go towards meeting the deductible.
GLP-1 medications, commonly used for managing diabetes, have become a new tool for weight loss, and demand has skyrocketed. GLP1s are pushing pharmacy budgets to the brink and one way to save money is to move the medication off the drug benefit to the medical benefit. While the strategy saves the insurer money, it also undermines access to life-saving treatments. The collateral damage is people like Mr. Franks, who are managing diabetes with a drug that has suddenly become an Albatross for pharmacy budgets.
Benefit Switcharoo
Pharmacy benefits typically divide prescription medications into two categories:
- Drug Benefit: Medications patients pick up at the pharmacy, often accompanied by predictable co-pays or coinsurance.
- Medical Benefit: Treatments administered in a clinical setting or requiring intensive monitoring, with costs applied to the patient’s deductible before coverage kicks in.
Moving GLP-1 medications into the medical benefit effectively saves money by shifting costs onto patients. Instead of paying a manageable co-pay, like $35, many are forced to pay the full cost of the drug until they meet their deductible, typically in the thousands of dollars range.
Switching medications from the drug benefit to the medical benefit may become the norm, but the consequences for patients could be grim:
- Increased Financial Strain: Patients will forego medications they cannot afford, risking their health and leading to costly complications and hospitalizations.
- Confusion and Mistrust: Patients are blindsided by the benefit change, with little understanding of why their costs are so much higher.
- Erosion of Doctor-Patient Trust: The high prescription cost strains relationships between patients and their providers as people ask why their physician would prescribe something so expensive. Physicians have no visibility into formulary changes.
In addition to benefit switches, some are also implementing a litany of new criteria to qualify for GLP-1 medications. Patients must meet strict BMI thresholds, participate in lifestyle modification programs for six months, and document progress meticulously. While these requirements aim to ensure appropriate use, they create barriers to care.
RazorMetrics: Shedding Light on Benefit Complexity
This growing practice highlights a critical gap in the healthcare system: the need for transparency. Patients deserve to understand their pharmacy benefits, including how changes impact their costs and access to care. This is where RazorMetrics can make a transformative difference.
With our platform, physicians and patients gain visibility into the factors driving cost and access issues, empowering them to make informed decisions:
- For Patients: RazorMetrics simplifies benefit complexities by making it easy for health plans to do the right thing for their members by aligning prescribers with the formulary. Our platform alerts physicians and patients to cost-saving alternatives pre-approved by their insurance provider. This helps both the plan and patients navigate benefit transitions with confidence.
- For Providers: We provide actionable insights to physicians, educating them about plan changes and offering recommendations that align cost control with patient well-being.
The practice of moving GLP-1s and other medications to the medical benefit prioritizes short-term savings over long-term health outcomes. However, by leveraging RazorMetrics, health plans and employers can strike a balance between cost containment and patient advocacy, ensuring that everyone—from the plan sponsor to the member—benefits from a transparent and equitable system.
Patients deserve more than just access to medications; they deserve clarity, compassion, and solutions that prioritize their well-being. RazorMetrics is here to help.
