Analysts see demand for specialty drug benefits
By National Underwriter
By Allison Bell
Many low-income and moderate-income U.S. adults say they would be willing to pay about $18 extra per month for generous coverage for specialty drugs.
A team of researchers backed by Bristol-Myers Squibb Company, New York (NYSE:BMY) -- a pharmaceutical company -- has presented that finding in a survey report published in the latest issue of Health Affairs, a peer-reviewed academic journal that focuses on health care finance and health care organization.
The team included John Romley, a professor at the University of Southern California (USC); Yuri Sanchez, an economist at Precision Health Economics L.L.C., Los Angeles; Dana Goldman, a professor at USC; and John Penrod, an economist at Bristol-Myers.
The researchers based their paper on Internet survey responses from 270 U.S. adults.
The researchers note that commercial group plan enrollees who need specialty drugs for conditions such as cancer and severe arthritis spend an average of about $12,000 per year on the drugs.
Up until now, there has been "no direct evidence on how much health people value generous specialty drug coverage," the researchers write in their paper.
The researchers told the survey participants that they had a 3% of needing specialty drugs in any given year, and that they could choose between a plan with no cost sharing for users of specialty drugs and a plan that capped out-of-pocket specialty drug costs at $167 per months.
The researchers found that 22% of the participants did not want the plan with generous specialty drug benefits at all and that about 18% said they were willing to pay $60 per month or more for the more generous plan.
The participants were willing to pay an average of about $13 per month extra for the more generous plan, and about half of all participants were willing to pay more than $20 per month extra.
Participants with incomes in the lower two-thirds were much more interested in specialty drug benefits than participants with incomes in the top third were.
The lower-income participants were willing to pay an average of about $18 per month extra for the more generous plan. The higher income participants were willing to pay only about $1.45 per month extra, and that amount "was not statistically different from zero," the researchers say.
The researchers looked only at participants' absolute level of interest in specialty drug benefits, not at other factors that might affect sales in the real world, such as consumers' access to the cash needed to pay for extra specialty drug benefits, or how consumers would allocate any extra protection dollars available to expenditures on drug benefits and all other protection products available, such as dental insurance, life insurance, dental insurance and long-term care insurance.
Originally published on LifeHealthPro.com