Gene Therapy Solutions from the Big 3
Breakthrough, potentially life-changing medications offer great promise for patients and their families. However, the high prices of the medications—millions of dollars in some cases—threaten coverage and access by patients who may benefit. As of March 2021, the FDA had approved over a dozen gene therapy products, including Zolgensma (estimated cost of $2.1 million per claim) and Luxturna (estimated cost of $850,000 per claim), and the cost of gene therapies is expected to reach more than $15 billion in the U.S. in the next 5 years. Consequently, pharmacy benefit managers (PBMs) have been working diligently to develop solutions that provide employer-sponsored plans access to these high-cost therapies at a financially predictable cost. Since some of the therapies may be curative, even the large upfront price tag could ultimately be less than the expected long-term, ongoing claims costs.
Express Scripts’ Embarc Benefit Protection
Express Scripts (ESI) has partnered with eviCore for medical management services to provide employer-sponsored plans with a capitated gene therapy solution called Embarc Benefit ProtectionSM. Both ESI and eviCore are part of the Cigna EvernorthSM family of companies and health care solutions. Employers opting into Embarc would pay roughly $1 per member per month (PMPM) to give members of their plan access to gene therapies included in the program (currently just Zolgensma and Luxturna). If a patient is prescribed any of the treatments covered under the Embarc program, the cost of the drug would be covered by the pre-paid PMPM charge; however, any inpatient costs, costs for administration, etc., would remain the responsibility of the plan. The program also includes various utilization management protocols to ensure appropriate use of the covered therapies. As the FDA approves more gene therapies, the list of covered therapies is expected to expand as determined by eviCore, which may also result in a reevaluation of the PMPM cost. Following the close of the calendar year, an Embarc Benefit Protection cost ratio (medical costs/total PMPM fees) will be calculated across all of eviCore’s Embarc Benefit Protection clients. If the cost ratio is under a pre-determined percentage for the calendar year and any previous calendar year deficits are recovered, eviCore will provide a pro rata credit to all Embarc Benefit Protection clients in that calendar year.
OptumRx Gene Therapy Risk Protection
Beginning January 1, 2022, OptumRx will offer a program that aims to provide patients access to ultra-high-cost gene therapies at a financially predictable cost. The product will cover Luxturna and Zolgensma, as well as two other gene therapies expected to enter the market in the next year, and, similar to ESI, will require program participants to pay a flat PMPM fee that provides coverage for the cost of clinically appropriate gene therapies. To further help mitigate financial volatility surrounding gene therapies, the risk protection plan includes quality management services such as utilization management/prior authorization and appeals to ensure clinically appropriate use of these therapies for administering and coverage. To further manage costs when expected clinical outcomes are not met, Optum is currently negotiating outcomes-based contracts with manufacturers.
CVS Solutions to Mitigate the Cost of Gene Therapies
Unlike ESI and Optum, CVS has taken a different approach to mitigating the high cost of gene therapies, currently offering plan sponsors two other potential solutions: a stop loss product and an installment payment plan. CVS’ financial protection program through stop loss solution
is underwritten by Aetna and available to self-funded CVS Caremark PBM clients without an active stop-loss policy that also covers these therapies. Clients can choose a policy for gene therapy coverage with three different deductible options and coverage includes the cost of the gene therapy product. Associated costs including facility and physician charges, which are covered by the client’s base medical plan are not included and members must receive the gene therapy product through Aetna’s network of gene therapy providers in order to qualify for gene
therapy stop loss reimbursement.
CVS also offers clients the option of an installment payment plan. Though the client is ultimately responsible for the entire cost of treatment, they are able to make payments over several years, mitigating the immediate financial impact of the claim/smoothing the impact of an immediate, large incurred cost. This option is available for select FDA-approved gene therapy products dispensed through CVS Specialty and payment terms are client-specific. Once a client has opted in and a patient receives treatment, the client remains responsible for the entire cost regardless of whether the beneficiary is still covered under their plan. Absent these programs, the same therapies will likely still be covered under traditional stop loss contracts. In fact, some stop loss carriers are developing financial risk mitigation solutions themselves. The key is making sure you have protection from these high-cost therapies either through traditional stop loss or these unique solutions outlined here—but not both—to ensure you are not paying “premium” twice for the
same coverage.
