For health insurance brokers working with group clients, it is crucial to have a comprehensive understanding of insurance benefits and utilization management practices, particularly for patients with serious and chronic illnesses such as cancer.
Cancer is the second leading cause of death in the U.S. This disease requires complex treatments. Cancer’s potential financial burden on patients makes it essential for employers to effectively navigate the intricacies of insurance coverage. Here is a comprehensive overview of the key issues employers must know when it comes to insurance benefits and utilization management techniques. This will enable employers to make informed decisions and offer the best support to their employees who have cancer.
Insurance benefits play a vital role in ensuring that cancer patients receive the necessary medical care while minimizing financial strain. However, cost-saving strategies, such as utilization management (UM) practices that control patients’ access to health care services, can have a negative – although unintended -- impact on treatment outcomes and quality of life.
Benefits brokers who advise corporate benefits managers can help them balance organizational costs with adequacy of coverage as they decide which new diagnostic tools and treatments will be covered by their plans. A significant challenge is how to avoid roadblocks to care and manage costs in the rapidly advancing science behind cancer treatment.
One common barrier to high quality cancer treatment is a lack of access to biomarker testing, which can identify markers within a person’s tumor to help clinicians create precisely targeted treatment plans. A CancerCaresurvey of patients who had biomarker testing found that only three out of 10 had insurance coverage for this testing. Yet, 20% of the cancer patients surveyed said the testing helped them avoid unnecessary chemotherapy or radiation. Ten percent became eligible for a clinical trial based on their biomarker testing results.
Insurance brokers have strategies and protocols to ensure appropriate and efficient use of health care resources. Brokers should be aware of the following aspects of utilization management in order to best advise their clients:
Prior authorization:Prior authorization (also known as pre-authorization, prior approval and pre-certification) is a process where insurers review the medical necessity of certain treatments or procedures before providing coverage. Employers should understand its impact since it can delay treatment, restrict access to medications or specialists and increase out-of-pocket costs for patients.
Formulary design: A drug formulary, or preferred drug list, is a continually updated list of medications and treatments which are approved for coverage by a health plan. Often arranged into tiers, formularies may be changed by health benefit plans without much notice. This can negatively impact patients who need access to their prescribed medications.
Step therapy:Step therapy (also known as “fail first” therapy) requires patients to first try a certain, less expensive drug on the plan’s formulary before moving up a “step” to a more expensive drug. This is a major challenge for hospitals, health systems, practices and pharmacy management, because insurance plans have many different prior authorization requirements. For oncology patients, step therapy can have significant negative consequences, such as the debilitating side effects that can occur when a therapy preferred by an insurer is not effective before receiving access to another therapy.
Specialty pharmacies:Specialty pharmacies manage the distribution of high cost or complicated medications. However, when health plans require that patients use specific specialty pharmacies, individuals may not be able to use their local pharmacy. This can sever a trusted relationship between patients and pharmacists. While some specialty pharmacies offer expert personalized service, others operate entirely through the mail. This may cause difficulties refilling prescriptions or shipment delays for seriously ill patients.
Copay accumulator programs: Copay accumulator programs have changed the way patients with serious conditions pay for their medications. When patients rely on drug manufacturer coupons or charities to cover expenses that their benefits do not, copay accumulator programs prevent counting this copay assistance toward an individual’s health insurance deductible or maximum out-of-pocket limit. This makes it much harder for patients to afford medically necessary prescription drugs.
How brokers can develop balanced benefit plans
Common utilization management practices can have adverse effects on patients, particularly those battling cancer and other severe illnesses. These practices manifest in the form of delayed, disrupted or denied care; amplified out-of-pocket prescription expenses, and obstacles to personalized health care. The implementation of cost-saving measures often proves detrimental as insurance plan limitations hinder patients from accessing necessary medications. This compromises employee well-being and productivity.
To alleviate barriers to care, employers should eliminate cumbersome pre-authorization processes and make coverage readily available to their employees. Quality health benefits yield advantages not only for patients but also for employers. They can enhance productivity, facilitate long-term control of medical expenditures, attract and retain skilled employees, and foster satisfaction and loyalty by exemplifying the company's regard for employee well-being.
To best serve employees, health insurance providers should work with employers to develop benefit plans that strike a balance between comprehensive coverage and cost containment. Additionally, exploring alternative coverage models, such as high-deductible health plans paired with health savings accounts, can furnish employees with choices without further burdening their tight budgets.