[ad_1]
Elevance Health and a coalition of other Blue Cross and Blue Shield carriers have launched Synergie Medication Collective, an independent company the plans see as a novel solution to costly physician-administered drugs, the insurers announced Thursday.
Nearly every Blue Cross and Blue Shield insurer invested undisclosed sums in the new venture. That makes Synergie one of the largest Blues collaborations in history. The partners are: Elevance Health, formerly Anthem, a for-profit company that sells Blue Cross and Blue Shield policies in 14 states; Blues plans in Arizona, Arkansas, Idaho, Iowa, Maryland, Missouri, South Carolina, Vermont and Washington state; the Blue Cross Blue Shield Association; Blues-founded pharmacy benefit manager Prime Therapeutics; and data analytics consultancy Evio Pharmacy Solutions.
These companies cover nearly 100 million members and aim to use their collective muscle to extract better deals and standardized contracts from pharmaceutical companies and the providers that administer drugs, said Synergie CEO Jarrod Henshaw, who previously served as chief innovation and supply chain officer at Prime Therapeutics. Synergie aims to offer its service to other insurers and to develop value-based payment models for these drugs, he said.
Synergie represents a pioneering attempt by the insurance industry to grapple with the new reality of drug pricing. Drug manufacturers now make most of their profits by developing high-cost treatments intended for small patient populations. Specialty medicines represented the majority of the $407 billion spent on the pharmaceuticals in the U.S. in 2021—55%, up from 28% a decade before—according to the data from the IQVIA Institute. The category includes medications such as CSL Behring’s Hemgenix, the first-ever gene therapy for Hemophilia B, which boasts a $3.5 million list price, the highest for any drug. The Food and Drug Administration approved Hemgenix in November.
“If you think about what that means for the healthcare system, it’s very exciting in terms of breakthrough technology and what it’s going to do for patients,” Henshaw said. “In terms of how people afford those medications, how plans actually manage the cost of these medicines, our system isn’t built for that today.”
Unlike Mark Cuban Cost Plus Drug Co.’s strategy of cutting prices for prescription medications dispensed at pharmacies, Synergie aims to disrupt the growing specialty drug market. Doctors inject or infuse these drugs in clinical settings or patients’ homes. That means they fall under the purview of medical benefits, not pharmacy, and it can be difficult for insurers to manage costs that are often bundled into single bills that include the site of service, clinicians’ time, medication prices and many other items.
Synergie stops short of being a full medical benefit manager because it does not provide utilization management services such as prior authorization or focus on site-of-service delivery by encouraging home visits, Henshaw said. It will operate under a transparent, pass-through model, where it hands over cost savings to participating insurers, he said.
The new company effectively will serve as a group purchasing organization for specialty drugs, which does not exist today, said Wayne Winegarden, director of Pacific Research Institute’s Center for Medical Economics and Innovation.
Along with bundled payments, hospital consolidation and misaligned incentives that award health systems more for administering costlier drugs can make it hard for insurers to negotiate with providers to reduce spending on specialty medications, said Antonio Ciaccia, CEO of drug pricing research firm 46brooklyn Research and president of consultancy 3 Axis Advisors.
“This is somewhat of a new frontier,” Ciaccia said. “It’s something that we have expected and, in some ways, has existed with duct tape and glue. Health plans have typically been ‘the managers’ since they’re handling everything on the medical benefit side. And when we buy things within the confines of a hospital, a lot of things are cooked into the sauce.”
Specialty drugs are so expensive because they are distributed in lower volumes, require customization for patients and have more sophisticated preparation and administration procedures than medications patients take themselves, Ciaccia said. Specialty medicines also are harder for competiing drug manufacturers to replicate, and their patents last four years longer than those for traditional pharmaceuticals, Ciaccia said.
And some of these medications, such as Hemgenix, only need to be infused once.
Health insurance companies, particularly those such as Blue Cross and Blue Shield carriers with large presences in the fully insured market, have a strong incentive to manage this category of drug spending, said David Dobrzykowski, associate professor and director Walton College’s healthcare initiatives. Individual market consumers tend to switch plans frequently and their insurers are responsible for paying claims with their own funds, unlike in the self-insured market where plan sponsors finance health benefits, he said.
“It’s low-hanging fruit, right? If I can somehow pool my spend and I can buy more, then I’m gonna buy that widget at a lower unit cost,” Dobrzykowski said.
[ad_2]
Source link
