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As I prepare to address the International Foundation of Employee Benefit Plans (IFEBP) audience next week in St. John’s, I have been reflecting on the theme I have been asked to speak on. The topic is “Drug Plan Cost Containment: Best Practice Ideas from Across Canada and Internationally.” What struck me about the topic is the word ideas. The problem is that most plan sponsors across Canada are still focused on ideas, but what we need are actions.
I can certainly understand the scepticism from plan sponsors who have long been promised lower drug plan costs through first generation cost containment tools like dispensing fee caps, mandatory generic substitution, lifestyle drug limits/exclusions, frozen formularies and cost-shifting to members, but have yet to realize sustained cost containment. The reality is that there are actions that plans need to be considering today that go well beyond limits of first generation cost containment strategies first brought to market more than a decade ago. The good news: the infrastructure now exists in the market to execute on second generation strategies that will contain costs for plans and members alike, without restricting access or reducing the value of the benefit to members.
The ideas are straightforward: we need enhanced Prior Authorization programs to manage the growing burden of specialty drugs, we need to embrace preferred provider networks that deliver better service and health outcomes at a lower cost, we need plan designs that incent appropriate utilization, and we need to measure the impact that drug plan spending is having on other areas of given plan’s experience.
Thanks to evolution in the marketplace – some driven by legislative changes, some driven by competition, and some driven by need – taking the necessary steps to manage plans effectively are within the reach of all plan sponsors. It is my sincere hope that the plan sponsors represented in the audience next week leave the conference motivated not just to think about ideas, but more importantly, to act.
Sincerely,
Mike Sullivan, RPh, BSP, MBA
President
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