Recently we received a question from one of our readers asking – how many health plans require consumers with mental health conditions to “fail first” on a particular list of mental health prescription drugs before they can have access to other medications? To find out we reviewed the District of Columbia and all 50 state Medicaid prescription drug programs.
But first, a little background on mental health drug spending in the U.S. In 2013, the U.S. spent $23.9 billion on mental health drugs (antipsychotics and antidepressants) – making it the third most expensive class of drugs (see United States 2013 Drug Spending Up 3.2% Over 2012 To $329 Billion). In 2011 (latest available data) Medicaid spent $8 billion for mental health drugs in the fee-for-service (FFS) delivery system alone. This represented 30% of total FFS spending (see 14% Of Medicaid Enrollees Used A Psychotropic Drug In 2011, Spending At $8 Billion). Furthermore, between 2011 and 2024 the cost of Medicaid prescription drugs in both the FFS and managed care delivery systems are expected to rise 14% (see NHE Projections 2014-2024 – Tables).
To address the growing cost of medications available to treat mental health disorders, health plans have adopted a wide range of strategies to limit consumer access to these medications. One of these strategies is the “fail first” policy referred to by our reader – otherwise known as step therapy. This is when a consumer must demonstrate less than effective treatment results or “fail” on a payer’s preferred drug before they may try a non-preferred drug. Step therapy is often used in conjunction with or as part of the prior authorization process. Some of the other measures used by health plans to limit consumer access to medications include:
- Prior Authorization (PA): The pre-approval process that a prescriber must use in order for a consumer’s payer to cover the prescribed drugs. The PA process varies between payers and even between different prescribed drugs under one payer. Generally the PA process includes therapeutic and clinical justification for a drug.
- Preferred Drug List (PDL): A formulary that lists all drugs in a therapeutic class that a payer will cover without special authorization. The purpose of a PDL is to ensure beneficiaries are being prescribed the most effective drugs while lowering costs. Drugs not included as preferred require prior authorization and additional clinical information to be prescribed. If a therapeutic class is not included on the PDL, it is not subject to the rules of the PDL, although the payer may still place restrictions on these drugs. State Medicaid programs generally choose what drugs are included on its PDL using a committee, called the Pharmacy and Therapeutics Committee that is comprised of health care professionals.
- Limitation on number of prescriptions: Under a state’s Medicaid program consumers can only receive a set number of prescriptions a month. Most states exclude certain drug classes from the limit such as those for family planning or immunosuppressant drugs.
Back to our reader’s question. We looked at Medicaid FFS pharmacy programs (we don’t have easy access to private health plan data – states have different policies for how health plans regulate drugs with some states allowing the health plan to set their own pharmacy program and restrictions while other states require the health plan to use the FFS policies). The answer – 25 states and D.C. Medicaid fee-for-service health plans have “fail first” policies for access to antipsychotic medications and 33 states use “fail first” policies for antidepressants.
Besides “fail first”, all states use at least some of these mechanisms to control the cost of prescription drugs – including mental health drugs. In fact, 43 states and Washington D.C. have a PDL, and of those states with a PDL, 35 states and D.C. include antipsychotics on their PDL, and 37 states and D.C. include antidepressants. Additionally there are two states that have voluntary mental health PDLs, meaning prescribers are not limited to the mental health drugs on the PDL, but they are preferred by the state. Finally, 15 states limit the number of prescriptions/refills a Medicaid beneficiary may be prescribed each month and some states include mental health drugs in that limit.
For more information on mental health prescription drug (and a complete state-by-state guide of mental health medication policies), check out our latest market intelligence report: How Are Mental Health Prescription Drugs Managed Under Medicaid & Medicare? An OPEN MINDS Market Intelligence Report. The report answers a number of questions including:
- How Do Health Plans Manage Access To Mental Health Prescription Drugs?
- How Are Mental Health Prescription Drugs Managed Under Medicare?
- How Are Mental Health Drugs Managed Under Medicaid?
- A State-By-State Guide On Medicaid Mental Health Drug Management
This report is free to all OPEN MINDS Circle premium members, and can be can be purchased in the OPEN MINDS e-Store for $495.
A question we hear a lot is – are these strategies bad for consumers? The answer- some strategies are worse than others. Prior authorization is used not only to restrict access to drugs, but to make sure that consumers are being prescribed the correct dosage, or that multiple antipsychotics are not prescribed at one time. Others strategies, such as PDLs or step therapy are a lot more harmful. Requiring a consumer to fail first on an antipsychotic or antidepressant before than can access a non-preferred drug puts them at risk for worsening their condition (see It’s Fail First Again). It’s important to keep an eye on these policies (and try to influence them) so that you can ensure that your consumers are getting the best possible care.