After describing many of the benefits the Exchanges have brought to patients—including access to both coverage and federal subsidies—the moderator for the 2014 BIO International Convention breakout session, Impact of Exchanges for Patients, tasked panelists representing a diverse group of stakeholders to describe the challenges that remain for patients enrolled in Exchange plans. These challenges fell into four main categories, including: formulary depth, patient out-of-pocket costs, transparency, and provider networks.
In terms of formulary depth, moderator Caroline Pearson from Avalere Health noted that, at least for 2014, Exchange plans offer formulary coverage that is roughly comparable to that offered by employer-sponsored plans. What does vary between these plans, however, is that Exchange plans typically have higher patient out-of-pocket costs, particularly in the form of high deductibles and the use of specialty tiers, which shift a substantial portion of the cost of drugs onto the patient.
Although the panelists noted that the out-of-pocket maximums established by the Affordable Care Act provide patients with significant financial protection, they highlighted that patients with high medical expenditures are often forced to pay all of these costs at the beginning of the year—something that may be challenging for lower-income patients, even those who receive federal cost-sharing reductions. This is particularly true for patients with high drug costs, as Exchange plans generally have discretion with respect to how these cost-sharing reductions are applied and often do not apply them to reduce out-of-pocket costs for specialty drugs.
Moreover, while the panelists noted that patients’ out-of-pocket exposure for items and services included in the medical benefit—including physician-administered drugs—remains relatively low, there was a resounding concern as to the complete lack of transparency regarding coverage in this benefit category, particularly prior to enrollment when patients often seek this information to inform their plan choice. Indeed, this lack of transparency was identified as an issue regarding all aspects of Exchange plan benefit design: not all plans make their formularies publicly available and plan provider networks may be subject to change without notice. To illustrate this last point, the patient on the panel noted that she had selected her specific plan because its network included her ophthalmologist only to discover, upon enrollment, that the ophthalmologist was no longer in-network.
In addition to the transparency issues, the panelists discussed the fact that the provider networks offered by Exchange plans are generally quite narrow, particularly as compared to typical employer plans. This is particularly apparent in the cancer space, as cancer hospitals are overwhelmingly excluded from these networks.
Throughout the session, the panelists outlined several means to address these issues for patients. Most notably, the panelists encouraged further transparency with respect to plan benefit design. They also highlighted several mechanisms that states are employing to reduce patient exposure to out-of-pocket spending and to improve access to providers excluded from plan networks. Finally, the panelists highlighted the importance of patient-assistance programs, including manufacturer coupons and patient assistance foundations, to help patients facing substantial out-of-pocket costs, particularly when these costs are concentrated at the start of the benefit year.