Employers Redesign Plans to Manage Drug Costs

By Stephen Miller, CEBS Jun 25, 2015

Although the vast majority of U.S. employers (88 percent) still rely on traditional plan designs (co-pays and co-insurance) to manage prescription drug costs, many are ready to focus on new and novel approaches. That’s the chief takeaway found by the Midwest Business Group on Health (MBGH), a nonprofit business coalition, in its fourth annual Employer Survey on Specialty Drug Management.

The survey, fielded from December 2014 through February 2015, found that:

*68 percent of employers are considering using a narrow network to manage employees’ health care, while less than 10 percent currently offer one.

  • While 16 percent already carve out their specialty drug benefit for specialized management, 63 percent are considering moving toward this strategy.
  • Over half of employers are considering shifting more costs to employees, with 18 percent already doing so.
  • 43 percent of the employers that shifted costs over the last three years increased the costs borne by employees by 50 percent last year.
  • 40 percent of employers include vendor performance guarantees, and 51 percent are willing to consider this in the future.

“These results are an encouraging sign that employers are ready to think proactively about their cost-management options,” said Cheryl Larson, MBGH vice president, in a news release. “It is also a reminder of the impacts cost-shifting can have on employees and family members, yet most employers don’t feel they have a choice.”

Stephen Miller, CEBS, is an online editor/manager for SHRM. Follow Me on Twitter

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