HR departments and benefits administrators are responsible for understanding what their group health insurance plans cover and how employees are using their benefits. Many coverage options extend to prescriptions to ensure that workers can afford their medication.
Unfortunately, prescriptions can be somewhat expensive and some companies struggle to develop a viable long-term solution for rising costs. HR departments need to understand pharmacy costs in order to avoid dire financial situations by keeping expenditures in check.
The issue with specialty drugs
The Society for Human Research Management reported that a 2011 study conducted by the Midwest Business Group on Health shows that only 53 percent of businesses had a moderate understanding of how to deal with specialty drugs, which are bioengineered drugs designed to treat dangerous disease. The problem with these medicines are that they are usually expensive. Perhaps most troubling is that the cost only seems to be rising.
According to Express Scripts' recent forecast, specialty drug spending will increase 67 percent by 2015. This means that employers need to find ways to deal with costs now to avoid fiscal hardship down the road. The SHRM recommends a value-based approach, which would cut co-payments so employees have to pay more than usual. However, this strategy also includes health coaching so that workers understand how to take their prescriptions so they can heal quickly, reducing the time they'd need medication.
This is a long-term plan that would benefit employees over time. While they may initially be frustrated by their increased pharmacy bills, providing coaching would ensure that staff members learn how to take care of themselves. The assistance sill likely prove invaluable and help contributors combat their conditions, recuperating sooner rather than later.
Regular prescriptions
USA Today recently noted that the Bureau of Economic Analysis has determined that prescription drug prices increased 3.6 percent in 2012, more than double the current rate of inflation (1.7 percent). The BEA concludes that brand-name drugs are the primary forces which are driving costs to higher levels.
Employers need to find ways to ensure that they're helping employees access necessary drugs without paying exorbitant bills. The easiest method is offering staff members a flat co-payment so that the organization won't be affected by price fluctuations and other market forces. Alternatively, companies can tie their co-payments to rate increases so that workers will be able to afford expensive prescriptions.