Reducing Specialty Drug Costs via Smart Technology combined with Deep Clinical Expertise

By Steven Wolinsky, Chief Medical Officer and Pegeen Butterfield, Director of Clinical Bill Review and Audit

The rapidly rising cost of specialty drugs is on payers’, employers’ and consumers’ minds. Specialty drugs now account for over $200 billion in total medical costs and are growing at over 17%.  About half of all specialty medications are billed through the medical benefit, which lacks the visibility, cost-control strategies and oversight of the pharmacy benefit, creating a need for prepayment cost management strategies.  Medical benefit specialty drugs treat a wide range of diseases or conditions; however, most are utilized for cancer and rare diseases and are typically administered in an outpatient facility, ambulatory infusion center, or the doctor’s office.

Complex billing procedures hinder the auditing of specialty high cost drug claims where patients often receive the same drug every week or every month for an extended time and where the cost of each dose is under the required threshold, yet the total cost per year is often greater than $50,000.  These claims often times bypass traditional edit and audit programs. Moreover, most PBMs are focused on self-administered drugs often dispensed by their own specialty pharmacy, creating a potential conflict of interest, as they manage the benefit and supply the drug.  Most of our clients, whether they are health plans or TPA’s, manage these drugs through prior authorization, but often are unaware of the treatment until after it is given especially in the outpatient department of the hospital, where the cost has been rising exponentially.

In response to our clients’ pain points, Zelis has developed a program to manage the cost of medical specialty drugs on a prepayment basis via a technology-guided auditing product.   The product takes advantage of Zelis’ existing, best-in-class, clinical auditing program for high-cost claims and adds a layer of Smart Selection technology.  Our Smart Logic identifies claims which might be relatively low cost but which show a pattern of driving high costs for that member over the course of time.  The Smart Logic further identifies claims which might yield a savings opportunity because the drug is being used for an unapproved, experimental off-label use or because, according to the claim coding, the dose is incorrect.

Also, created through Zelis’ episode-of-care technology is the Patient Care Record.  This unique feature enables Zelis to detect variability of provider billing practices and changes in treatments that are linked from claim to claim, supporting consistent medical decision-making, and multiplying the savings across that patient’s future

While the technology is outstanding, our program is further powered by our people.  Once we complete our focused audit, our nurse auditors verify that the claim is reviewed to ensure the most appropriate reimbursement based on unit costs of the drugs being administered.  They then enter into a Letter of Agreement with the provider to ensure alignment on reimbursement.

The Zelis High Cost Drug Solution was launched on August 1st as an enhancement of our existing high-cost claim auditing program.  By combining Smart logic, Patient Care Record technology, and expert clinician auditing, we are able to yield increased savings, plus excellent clinical results for our clients and their members.  Zelis is confident that this program will help our clients to ensure that care is medically appropriate and that the cost of high cost drugs is appropriately managed.  For more information on the Zelis High Cost Drug Solution, please attend the MedView Webinar scheduled for October 3rd…details to follow!