Keeping the Medications You Need in Reach

Jerry Grassmeier was enjoying good health two years after having a liver transplant when he received a letter one day from his health plan.

It informed him that the plan had been sold to another company and that it would no longer be covering the antirejection medications he needed daily to keep his new liver functioning.

The Santa Clarita man’s story bears some important lessons for anyone picking a new health plan: Don’t forget to check out the plan’s prescription drug benefit. And know what actions you can take to get the medications you need.

“What really devastated me was that their approach was so nonchalant,” says Grassmeier, 59, who found another plan that would cover the cost of medications ($1,300 for a 110-day supply). “They suggested I try another plan. They put it all on me. Cold. Flat-out. One day you have it, one day you don’t. I was really panicking.”

During open enrollment, most of us focus on which doctor to select. You might also check out which hospital you would be sent to, should the need arise. But if you don’t examine whether the health plan pays for particular medications and what your co-payment would be, you may be stumbling into the wrong plan.

Pharmaceutical benefits are important “because it’s the thing you use more often than any other benefit,” says Del Konner, president and chief executive of Pharmaceutical Care Management Assn., an Arlington, Va., firm.

There are many reasons consumers should give equal weight to their drug benefit, says Kassy Perry, executive director of Citizens for the Right to Know, a Sacramento-based consumer coalition representing dozens of nonprofit health groups.

“The prescription drug benefit is often the first interface a consumer has with their health plan and the most cost-effective portion of the health care dollar,” Perry says.

Drug makers are increasingly churning out new therapies that represent significant advances in fighting disease and can dramatically improve people’s health and lives in general.

On the other hand, health insurance experts point out, some breakthrough drugs--Viagra for impotence and Raloxifene for osteoporosis, for example--carry steep price tags that can help drive up the cost to employers of providing a pharmaceutical benefit.

In the 12 months ended in June, Americans spent $87.8 billion on prescription drugs--up from $81.1 billion in calendar year 1997, according to Nancy Duclett of IMS Health, a health care information company.

John Jones, director of pharmacy networks and legal affairs for PacifiCare, says health plans are anticipating a 15% increase in drug costs.

“There has been a great deal of pressure on the prescription drug benefit,” notes Susan Pisano, vice president of the American Assn. of Health Plans, a Washington, D.C.-based industry group. “The cost of the benefit has been rising much faster than other elements of the benefit package. Health plans recognize how valuable the benefit is and are working very hard to maintain an affordable drug benefit.”

New Laws Next Year to Protect Consumers

The tug of war between consumers trying to obtain medications and insurers trying to keep a lid on costs has led to numerous consumer complaints and resulted in new laws that will affect most Californians.

Beginning in July 1999, two new consumer-protection laws will go into effect. One law requires insurance companies to disclose their prescription drug formularies. The formulary is the catalog of products that the plan will pay for. Another law ensures that a patient can continue taking a particular medication if it is dropped from the formulary or if the patient switches health plans.

Insurance industry experts say formularies are necessary to control costs, ensure quality and track prescribing patterns. Formularies influence doctors to use prudence when choosing drugs and to balance cost with quality. They also help doctors resist pressure from drug company salespeople and cope with the often overwhelming task of keeping up-to-date on some 15,000 different drugs, with new ones coming out every day.

“Formularies started in hospitals more than 40 years ago,” says Konner. “The idea was that there is no reason for a pharmacy to carry 50 different kinds of aspirin, for example.”

Until now, however, it has been difficult for consumers to see a formulary or even confirm that their health plan has one. A Citizens for the Right to Know survey of California health care companies released in April found that only about one-third of health plans responded to a request to view their formularies. (That number is up from a similar survey in 1997, when 21% of companies responded positively to the request.)

The new law will assist consumers who rely on a specific medication. “This has been a huge issue for some people, such as the mental-health community,” Perry says.

For example, PacifiCare, a Cypress-based HMO, has moved aggressively in recent years to switch patients with clinical depression from the antidepressant Prozac to another drug, usually Paxil. Perry says her group has received numerous complaints from PacifiCare members that they could no longer obtain Prozac.

Prozac and Paxil are both from a category of antidepressants called selective serotonin reuptake inhibitors and are chemically similar but not identical, especially in the side effects each produces, according to the American Psychiatric Assn.

Many health plans say they do not bar members from having access to particular medications. But Perry argues that some plans make it extremely difficult for people to get what they need.

“Most plans will say everything is covered. But it’s the process the plans put in place,” Perry says. “How many hoops do you have to jump through to get something? Sometimes your doctor will have to show that you’ve failed on other medications before you’re authorized to receive another drug.”

But Jones, of PacifiCare, says members who need Prozac can receive it without a hassle. While the Prozac and the SSRI antidepressant Zoloft are not on the plan’s formulary, he says physicians need only to call PacifiCare to explain the need to get a drug off the approved list.

“We usually ask for the doctor’s reasoning in choosing Prozac over a drug on the formulary. The average wait time [to receive authorization] is five minutes,” he says.

Jones notes that in July, the last month for which PacifiCare prescribing data were available, 4,500 prescriptions were written for Prozac and 2,300 for Zoloft while 7,500 were written for the formulary choice: Paxil.

“If it was really difficult to get Prozac, we wouldn’t have one-third of our SSRI’s prescriptions written for it,” he says.

Deals Made With Drug Companies

A doctor treating a newly diagnosed patient for major depression would be advised to try the formulary drug first, Jones acknowledges. And the reason has to do primarily with cost. For example, since there are four SSRI antidepressants on the market, health plans can bargain with one or two manufacturers to offer only their medications on the formulary in exchange for discounted prices. Under such an arrangement, Jones says, the plan saves money and the manufacturer creates a new outlet for sales.

A one-month prescription of Prozac costs PacifiCare $113, for example, contrasted with $70 for Paxil, the formulary drug.

But consumer advocates charge that without laws to restrict them, health plans create their formularies based on financial arrangements that do not, necessarily, have the consumers’ best interests in mind. According to an internal memorandum, one PacifiCare medical group last year advised its doctors to prescribe a tricyclic antidepressant before trying an SSRI. Generally, tricyclics cause many more side effects and are no longer considered a first-choice medication for the depression, according to the American Psychiatric Assn.

Another managed-care company, Health Net, based in Woodland Hills, acknowledges that it has had a business agreement with drug giant Bristol-Myers Squibb to add its products to the Health Net formulary--excluding other brand-name medications--whenever feasible. In return, Bristol-Myers makes a one-time payment to Health Net and provides its drugs at a discount.

“The issue that health companies are paid to grant favorable status to particular pharmaceutical companies is old news,” says Ron Yukelson, vice president for public relations at Health Net. “Yes, we will encourage utilization of the formulary within certain classes of drugs. That’s not to say that members won’t have access to medications their doctors say they need.”

A proposed new agreement between Health Net and Bristol-Myers, for example, details the HMO’s plan to use the drug maker’s Pravachol as its cholesterol-lowering product, Serzone among SSRIs, Monopril among ACE inhibitors that treat hypertension, and Cefzil among antibiotics in the cephalosporins category--all of which the memo states are “superior” clinically.

And, indeed, most doctors would rate all of them good products. But if a pediatrician was told to prescribe Cefzil for a child’s ear infection, that might make some uncomfortable, says Dr. Victoria Paterno, a Santa Monica pediatrician and member of the L.A.-based American Private Physicians’ Assn., a group that disagrees with many managed-care policies. Cefzil works well on a broad spectrum of bacteria and only has to be given twice a day. But the general view among pediatricians (and kids) is that it tastes awful.

“I’m a pediatrician, and I know how it is to try to force a medicine that tastes bad down a kid’s throat,” Paterno says. “Then there is the issue of ease of use. If you have a mom and dad who work and you prescribe a drug that has to be taken three times a day, they would have to leave work to give the child the medicine. The drugs I use may be more expensive, but if the child is more likely to get [all doses], it’s cheaper in the long run.”

A Push on Generic Medications

In this era of soaring health care prices, consumers must recognize the need to control costs, says Konner. People should opt for generic medications, which cost less, whenever possible and should not be averse to trying a less-expensive drug before demanding a higher-priced one.

“There will always be an incentive to dispense the least expensive medication possible.” But, Konner adds: “The industry can’t go too far afield and end up preventing people from getting what they need. They can’t overlook quality for cost.”

Some insurance plans are offering a “three-tiered” co-payment system that allows consumers to opt for receiving a generic drug on the plan’s formulary for the lowest co-pay, a brand-name medication on the formulary for a higher co-payment or a drug that is not on the formulary for the highest co-payment.

“If a patient wants to take a drug not on the formulary, they can, but they have to pay more,” Konner says. “I think the consumer is cost-conscious and they’ll go back and say, ‘Give me the one on the formulary.’ ”

Neither government regulations nor industry changes seems to have had much influence on a problem that is much harder to pin down: subtle or overt pressure on doctors to prescribe the least-expensive medications. Some plans offer bonuses to doctors who keep tight reins on the costly prescriptions. Other plans monitor doctors who are prescribing high numbers of nonformulary medications. The consumer, however, has no way of knowing if his or her doctor is allowing such pressure to influence what is prescribed.

Paterno, who does not participate in HMOs but is part of preferred provider organizations, a looser type of managed care, said a health plan recently sent her a list of patients for whom she prescribed medications that were not on the formulary.

“The letter said, ‘Do you know that there are other drugs on our formulary that we recommend?’ ” Paterno says. “When you are a part of these plans it can’t help but affect your thinking, even if it’s subconscious.”

There is no law that protects doctors from pressure to prescribe particular drugs, notes Perry. Thus, consumers should have candid discussions with their primary care providers.

“Consumers have to find out if their doctor is under financial pressure to prescribe one drug over another,” says Perry. “But the only way to do it is to ask your doctor straightforward.”

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To examine your health plan’s prescription drug formulary, try either of these Web sites:

The Pacific Business Group on Health: https://www.healthscope.org

Citizens for the Right to Know: https://www.rtk.org