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VOL. 129 | NO. 70 | Thursday, April 10, 2014

Report: Exchanges Yield More Specialty Drug Claims

TOM MURPHY | AP Business Writer

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Patients from the health care overhaul's new insurance exchanges have been more likely to use expensive specialty drugs for chronic conditions, according to data from the nation's largest pharmacy benefits manager.

Numbers released Wednesday by Express Scripts point to a concern health insurers have had about the cost of the overhaul's coverage expansions, but the pharmacy benefits manager cautioned that its data represent "a very early analysis."

Express Scripts said that just over 1 percent of the prescriptions it processed from exchange enrollees in January and February were for specialty medicines. That compares with less than 1 percent of patients with commercial health plans.

Those small numbers carry some heft. Express Scripts said specialty drugs, which are used to treat conditions like cancer, hepatitis C and HIV, account for more than a quarter of the country's pharmacy spending even though they total less than 1 percent of all prescriptions.

Express Scripts found that the proportion of prescriptions from exchange plans for HIV treatments was nearly four times higher than the proportion found in commercial plans. In total, the company said six of the 10 costliest medications used by exchange enrollees were specialty drugs. That compares to four of 10 for commercial health plans.

State-based health insurance exchanges opened for enrollment last fall, and customers could start using income-based tax credits to buy coverage that started in January. But problems with a key conduit for those exchanges, the HealthCare.gov website, left many exchange customers frustrated. Insurers worried that, at least initially, the only people who would persist through the problems and sign up for coverage would be sick customers who generate lots of claims.

Express Scripts Vice President Julie Huppert said that the analysis only "starts to tell the story" of how these newly insured enrollees have used their coverage. Express Scripts analyzed a sample of more than 650,000 claims from January and February.

Enrollment for the exchanges ended last month, so that sample left out all the people who have had coverage start in March and April.

Health plans are still processing their newly enrolled customers, so it's "way too early" to get a feel for what sort of business will ultimately come from the exchanges, said Morningstar analyst Vishnu Lekraj, who follows pharmacy benefits managers and drugstores.

He noted that younger and healthier customers who tend to use less medical care were expected to sign up more toward the end of the enrollment window. He said companies probably won't get a good feel for what the exchange business looks like until the fall.

Express Scripts Holding Co. runs drug plans for employers, insurers and other clients and process mail-order prescriptions. It also has a large specialty pharmaceutical business it acquired in a $29.1 billion deal for competitor Medco Health Solutions that it completed a couple years ago.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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