INSURED AND INFORMED

A study offered last week by the Maine Health Information Center shows at least one area where those buying insurance can act to reduce costs. More long term, it suggests employers will increasingly make choices about health care costs based on data they have produced cooperatively and out of a desire for self-preservation.

Employer costs for prescription drugs, based on a survey of 10 Maine employers, rose 30 percent here from 1998 to 2000; for employees and their dependents, the increase was more than double that. The cost went up so sharply because Mainers are using more prescription drugs, they are using more of the new, more expensive drugs and they are slightly less often using generic drugs. The employers that took part in the study were Lucas Tree, Hussey Seating, Hannaford Bros., L.L. Bean, St. Mary’s Regional Medical Center, state of Maine, Maine Municipal Association, University of Maine System, Maine Medical Center and Bowdoin College.

The study notes that some of the increased utilization “can be attributed to the promotion of care guidelines for conditions such as depression and heart attacks, resulting in better care for patients,” but the dollar value of that is hard to quantify. It also isn’t clear whether the increased use actually saves money by allowing patients to avoid surgical procedures. These are areas that should be studied further, although they would have significantly expanded this early effort by the center. Another area of interest should be the effect of marketing: An accompanying press release notes that some of the more popular expensive drugs have been heavily marketed, but the link between marketing and price is more anecdotal than statistical.

The value of the study is that it identifies important buying and use trends, which, it reports, were consistent with national trends. Some of the Maine trends were the following: Increased pharmacy costs accounted for 46 percent of the increase in employers’ combined medical and pharmacy claims. Ten therapeutic categories of drugs accounted for 79 percent of the total drug expenditures and 73 percent of the increase in costs in 2000. Three therapeutic categories – for arthritis, depression and high cholesterol – accounted for 34 percent of the cost increase.

The numbers in the study will be used well if employers begin making more sophisticated decisions about coverage of prescription drugs, with the accumulation of data leading to more information about quality of treatment vs. cost. One decision already has been made: More than 40,000 current and retired state workers and their families last week began taking part in a generic drug incentive program that was developed after the study results were analyzed.

If it works, look for more employers to use incentives or make more comparative information available so employees can make better-informed choices about out-of-pocket expenses.