Audience - Employers
“The variety of [defined contribution] products becoming
available not only reflects the nature of an emerging market but also
appears to mirror a growing need for custom approaches to health care.
‘Medical technology is outgrowing current insurance models,’
said Karen Williams, president of the National Pharmaceutical Council.
Williams admitted being ‘enamored’ of [defined contribution],
especially for its potential to allow patients to customize their health
treatments. This personalized approach is becoming more important as medical
advances reveal even more information about individuals' chronic conditions
and potentially successful treatments.”
--From “Some say DC health ‘inevitable’ ”
Employee Benefit News, July 1, 2001
Are the Benefits of Newer Drugs Worth Their Cost? Evidence From the 1996 MEPS, by Frank R. Lichtenberg, Health Affairs, Vol. 20, No.5,
September/October 2001
Critics of pharmaceutical spending point to the increase in the pharmaceutical “line item” in our overall health spending as cause for alarm. Lichtenberg's research examines the value of this spending in its complete context by exploring whether there are cost offsets associated with using newer and, most often, more expensive drugs. Lichtenberg finds that we are paying more, but we are getting a bigger “bang for our buck.”
Annotated PowerPoint slides related to this article are available.
Availability of New Drugs and Americans' Ability to Work, by Frank R. Lichtenberg, PhD, Journal of Occupational and Environmental Medicine, Vol. 47, No. 4, April 2005
This work examines the extent to which the introduction of new drugs has increased society's ability to produce goods and services by increasing the
number of hours worked per member of the working-age population. The study finds that the potential of medicines to increase employee productivity should be considered in the design of drug-reimbursement policies. Conversely, policies that broadly reduce the development and utilization of new drugs may ultimately reduce our ability to produce other goods and services.
Business and Managed Care Diabetes and Health Resource Kit
More than 18.2 million Americans have diabetes, many of them the workforce. This online diabetes and health resource kit is designed to help businesses and managed care companies to assess the impact of diabetes in the workplace. It also provides easy-to-understand information for employers to help their employees manage their diabetes and take steps toward reducing the risk for diabetes-related complications such as heart disease.
A Closer Look at Allergies, 2001
Allergies are the sixth leading cause of chronic disease in the U.S., and cost the health care system over $18 billion annually. In this publication, a joint project between the Asthma and Allergy Foundation of America and NPC, we take a closer look factors influencing drug spending for allergies.
A Closer Look at Arthritis, 2002
One in six Americans suffers from arthritis, and the CDC projects that number will grow to one in five by 2020. In this six-page brochure, a collaborative project between the Arthritis Foundation and NPC, we take a closer look at the factors influencing drug spending for treating arthritis.
A Closer Look at Asthma, 2001
Asthma results in approximately 5,000 deaths annually in the U.S. and accounts for nearly half a million hospitalizations, 1.6 million emergency room visits, and over 10 million physician office visits. In this six-page brochure, a joint project between the Asthma and Allergy Foundation of America and NPC, we take a closer look at the factors influencing drug spending for the treatment of asthma.
A Closer Look at Depression, 2002
Clinical depression is a widespread and debilitating illness that cost Americans $44 billion in 1990, making it one of the nation's ten most costly diseases. In this six-page brochure, a collaboration between the National Alliance for the Mentally Ill and NPC, we take a closer look at the factors that influence
drug spending for treating depression.
A Closer Look at Diabetes, 2002
The number of Americans diagnosed with diabetes jumped 49 percent from 1990 to 2000. Diabetes is the main cause of kidney failure, new cases of blindness, and lower limb amputations, and is a major risk factor for heart disease and stroke. In this six-page brochure, a joint project between the American Diabetes Association and NPC, we take a closer look at the factors that influence drug spending for the treatment of diabetes.
A Closer Look at High Blood Pressure, 2001
Roughly 50 million Americans ages six and older have high blood pressure. Left untreated, high blood pressure can lead to heart disease, kidney disease, and stroke. In this six-page brochure, a joint project between the American Heart Association and NPC, we take a closer look at the factors influencing drug spending for the treatment of high blood pressure.
A Closer Look at High Cholesterol, 2001
High cholesterol is a major risk factor in heart disease, the leading cause of death in the U.S., which claims the lives of nearly 460,000 Americans each year. In this six-page brochure, a joint project between the American Heart Association and NPC, we take a closer look at the factors influencing drug spending for the treatment of high cholesterol.
Component Management Fails to Save Health Care System Costs: The Case of Restrictive Formularies, Second Edition, 2000
This 81-page monograph updates and extends the information first compiled in 1996. The monograph reviews the literature through mid-1999 on the effects of restrictive formularies, caps, copays and prior authorization on total costs and treatment outcomes. Taken together, the reviewed literature makes the overwhelming case that such policies are likely to have unintended negative consequences. Fact sheet available.
Consumer Reports on the Health Effects of Direct-to-Consumer Advertising of Prescription Drugs, by Joel S. Weissman, et al., Health Affairs Web Exclusive, February 2003
This paper reports the results of a study of the health behaviors and outcomes that result when patients initiate discussions with their doctors as a result of seeing a prescription drug ad. Consumers reported that DTCA-motivated discussions with physicians frequently result in new diagnoses for clinically important conditions, and the survey found no evidence to support concerns about adverse health consequences.
Cost-Effective Opportunities for Improving Depression-Related Outcomes, by Sean Sullivan, Health & Productivity Management, Vol. 2, No.3
Depression has a clear impact on productivity. Depressed patients, particularly those not in treatment, are high-cost users of health care, consuming two to four times more resources than other patients. A May 2002 survey by the Institute for Health and Productivity Management found that mental health conditions – primarily depression – ranked second as a cause of employee absences and first as a cause of presenteeism among large American companies. The use of appropriate treatments can reduce indirect employer costs including lost productivity in the workplace.
Cultural and Genetic Diversity in America: The Need for Individualized Pharmaceutical Treatment, by Valentine J. Burroughs, et al., 2002
Pharmacogenetic research in the past few decades has uncovered significant differences among population groups in the metabolism, clinical effectiveness, and side effect profiles of many clinically important drugs. In addition, differences in how various populations view and respond to medicines underscores the need for an individualized approach to pharmaceutical therapy. Cost management policy design must take these differences into
account in order to ensure that they are broad and flexible enough to enable rational choices and individualized treatment for all patients, regardless of racial or ethnic origin. Fact Sheet available.
Annotated PowerPoint slides related to this report are available.
DM LitFinder™ Database
The Disease Management Association of America offers a query tool to search the peer-reviewed literature available on disease management for eight conditions (asthma, congestive heart failure, diabetes, COPD, coronary artery disease, end-stage renal disease, high risk pregnancy, and depression). Updated quarterly, this tool helps users identify programs that have reported medical cost savings and demonstrated improvements in clinical processes and outcomes of care such as drug compliance, reduced absenteeism and better quality of life, and what patient and physician interventions were used to achieve these outcomes.
Drug-Related Adverse Events: A Readers' Guide to Assessing Literature Reviews and Meta-Analyses, by Susan D. Ross, MD, Archives of Internal Medicine, Vol. 161, April 23, 2001
The objective of this article is to provide readers with a practical guide to critically appraising reviews and meta-analyses of source studies of drug-related adverse events. A critique of a highly publicized meta-analysis is used as a case study to highlight several contentious issues.
An Employer's Guide to Patient-Directed Healthcare Benefits, 2001
This guide, produced by the Wye River Group on Healthcare, addresses issues surrounding the emerging consumer directed or defined contribution benefit plans. It was designed to describe and clarify evolving methods of health care financing, the current regulatory and tax environment, and the political "appetite for change" regarding consumer involvement in health care purchasing.
An Employer's Guide to Pharmaceutical Benefits, 2003
This guide, produced by the Wye River Group on Healthcare, focuses on the role of
employer-purchasers in providing pharmaceutical benefits for employees, as they struggle to balance economic pressures with a need to support their workforce. It is intended to provide practical tools to assist employers in meeting those demands.
Explaining Drug Spending Trends: Does Perception Match Reality? by Robert Dubois, et al., Health Affairs, Vol. 19, No. 2, March/April 2000
Using large claims databases from managed care and employer-sponsored health benefit plans, this study found increased volume, not rising pricing, accounted for drugs’ higher levels of spending. For more information about the methodology used for this study, see Measuring the Costs and Benefits of Pharmaceutical Expenditures, Expert Review of Pharmacoeconomics and Outcomes Research, October 2002.
Annotated PowerPoint slides related to this article are available.
Growth in Use of Lipid-Lowering Therapies: Are We Targeting the Right Patients? by Robert W. Dubois, MD, PhD, et al., American Journal of Managed Care, Vol. 8, October 2002
This article looks at the appropriateness of statin use in 1997 (pre-DTCA guidance) and in 1999 (post-DTCA guidance). The conclusion is that although the number of people being treated with statins rose considerably from 1997 to 1999, there did not appear to be any shift towards less appropriate treatment.
Health, Absence, Disability, and Presenteeism Cost Estimates of Certain Physical and Mental Health Conditions Affecting U.S. Employers, by Ron Z. Goetzel, PhD, et al., Journal of Occupational and Environmental Medicine, Vol. 46, No.4, April 2004
Employers are becoming increasingly aware of the productivity-related cost burden associated with certain health conditions. This study synthesizes the total cost of health, absence, short-term disability, and productivity loss for 10 conditions. The overall economic burden of illness was highest for hypertension, heart disease, depression and other mental illnesses, and arthritis. Presenteeism costs were higher than medical costs in most cases, and represented 18-60% of all costs for the 10 conditions.
The Health and Productivity Cost Burden of the “Top 10” Physical and Mental Health Conditions Affecting Six Large U.S. Employers, by Ron Z. Goetzel, et al., Journal of Occupational and Environmental Medicine, Vol. 45, No.1, January 2003
This article identifies the top 10 most costly physical and mental health conditions faced by six large employers in their health benefits programs. The research identifies costs associated with each condition including direct medical costs and the indirect costs associated with days absent from the job and short-term disability costs.
Health & Productivity as a Business Strategy, 2007
Results from the first in a series of studies among multiple employers aims to quantify the true value of employee health. The study, published in the July issue of Journal of Occupational and Environmental Medicine (JOEM), found that health-related productivity costs were four times greater than medical and pharmacy costs, and the costliest conditions may not be the ones that employers are focusing on. The authors suggest investing in healthy employees can yield substantial economic benefits for companies.
Related materials:
Health Care & Productivity, 2000
This newsletter, designed for employers, details how newer drug therapies have direct and profound effects on productivity and the bottom lines of employers who select and provide health benefits.
The Impact of Tiered Co-Pays: A Survey of Patients and Pharmacists, 2003
Employers increasingly have adopted strategies to reduce prescription drug expenditures, including cost-sharing arrangements that require employees to pay a greater share of the costs. In 2002, approximately 57% of people with employer-sponsored health benefits were enrolled in multi-tier co-pay plans. The growing use of tiered benefit plans and increasing co-pay levels has prompted concern that higher co-pays may lead patients, particularly those with chronic illnesses, to reduce prescription drug compliance and,
consequently, experience negative health outcomes that result in increased utilization of other health care services. To view the study instruments, click here.
Information for Consumer Groups about the NAIC's Model Act on Prescription Drug Benefit Management, 2002
This six-page fact sheet examines the National Association of Insurance Commisioners' (NAIC) model act currently in development regarding pharmacy benefit management. A four-page table compares the consumer protections offered by the draft model act with the provisions offered by the insurance industry in an alternate model act, and the provisions desired for optimum consumer protection.
Investing in Healthy Human Capital, by Marc L. Berger, MD, et al., Journal of Occupational and Environmental Medicine, Vol. 45, No. 12, December 2003
Although the value of human capital is not captured on company balance sheets, it may account for about half of the gap between a company's market value and book value. Yet, many companies do not focus comparable scrutiny on human capital management as compared with other large assets, nor do they systematically measure its output. Methods are emerging to enable employers to assess productivity losses, including absenteeism and presenteeism, and to understand the associated costs, thus permitting employers to assess the value of programs to enhance health and productivity.
MedAccess Online Bibliography on Atypical Antipsychotics
This bibliography, developed by Dr. William M. Glazer, President of Glazer Medical Solutions and Associate Clinical Professor of Psychiatry at Massachusetts General Hospital and Harvard Medical School, presents studies demonstrating the value of the atypical antipsychotic medications clozapine, olanzapine, quetiapine, and resperidone.
National Partnership for Workplace Mental Health
A program of the American Psychiatric Foundation, the National Partnership for Workplace Mental Health delivers educational materials to employers and employees on a broad range of mental health topics, provides a forum for businesses to explore mental health issues and share innovative solutions, and serves as a clearinghouse of mental health information important to employers.
Noncompliance with Medications: An Economic Tragedy with Important Implications for Health Care Reform, 1994
The economic and medical consequences of noncompliance to the U.S. health care system are examined in this 32-page NPC publication. Understand how noncompliance accounts for up to $100 billion in health care and productivity costs.
Perspectives on the Pharmaceutical Industry, by Uwe E. Reinhardt, Health Affairs, Vol. 20, No. 5, September/October 2001
Reinhardt's research shows that our nation can indeed afford spending on drugs that help us live longer, more productive lives. Spending on
pharmaceuticals accounts for only a small fraction of our Gross Domestic Product (GDP). In fact, Americans spend more per capita on alcohol, tobacco, and entertainment combined than on pharmaceuticals.
Annotated PowerPoint slides related to this article are available.
Pharmaceuticals and Productivity: Investing in Human Capital, 2001
(Note: ~20mb)
New therapies have the potential to produce economic savings and benefits both outside of the health care system (indirect savings) and within the system (direct savings). This report explores the question of whether spending on pharmaceuticals has a positive payoff.
Pharmaceuticals and Worker Productivity Loss: A Critical Review of the Literature, by Wayne N. Burton, MD, Alan Morrison, PhD, and Albert I. Wertheimer, PhD, Journal of Occupational and Environmental Medicine, Vol. 45, No. 6, June 2003
Many chronic illnesses that affect the working population can cause losses in productivity. The evidence is very good for about a dozen drug classes that pharmaceuticals reduce productivity losses caused by respiratory illnesses (i.e. asthma, allergic disorders, bronchitis, upper respiratory infections, and influenza), diabetes, depression, dysmenorrhea, and migraine. This article should be helpful to occupational physicians who are increasingly providing recommendations on employer benefit plan designs and pharmaceutical benefits.
Annotated PowerPoint slides related to this article are available.
CD-ROM Prescription Medicines: Returning Value to Patients, Payers and Society, 2003
Studies confirm that indeed, medicines are one of the fastest growing areas of health care spending. And while few can imagine life without the life improving medicines that patients with diabetes, heart disease, cancer, HIV/AIDS, and many others have come to depend on, some have questioned the value of that spending – to the health care system overall and to consumers. In this compilation of materials – much of it peer-reviewed research – we hope to help answer some of the critical questions in this debate.
Presenteeism: At Work—But Out of It, by Paul Hemp, Harvard Business Review, October 2004
As companies struggle to rein in health care costs, most overlook what may be a $150 billion problem: the nearly invisible drain on worker productivity caused by such common ailments as hay fever, headaches, and even heartburn. However, a handful of companies are recognizing the problem of presenteeism and trying to do something about it.
The Price of Progress: Prescription Drugs in the Health Care Market, by J.D. Kleinke, Health Affairs, Vol. 20, No. 5, September/October 2001
Kleinke's research tells us that increased spending on pharmaceuticals does not explain the insurance premium increases that many consumers are seeing.
He points out that pharmaceuticals are a small fraction of the total equation, and that even though spending on pharmaceuticals is increasing, that rise in expenditures amounts to a small percentage of the premium increases.
View "Measuring the Value of Health Innovations: The Policy Implications of New Medical Technologies," a briefing by the Alliance for Health Reform featuring J.D. Kleinke, September 7, 2001, Washington, DC
Productivity Impact Model: Calculating the Impact of Depression in the Workplace and the Benefits of Treatment
Depression is a leading cause of absenteeism and low productivity in the workforce. It affects almost every company to some degree, and its costs are high. The Productivity Impact Model can help employers determine the incidence of depression an organization, predict the expected number of days each year employees will be absent or suffer low productivity due to depression, estimate the costs associated with this lost productivity, and project the net savings that will accrue with treatment of employees suffering from depression.
The Silver Book: Chronic Disease and Medical Innovation in an Aging Nation
The Silver Book, a project of the Alliance for Aging Research is an almanac of hundreds of facts, statistics, graphs, and information from close to 100 agencies, organizations and experts. It is a searchable database that is constantly updated and expanded in order to highlight the latest research and data on the burden of chronic disease and the value of investing in medical research. The Silver Book database is searchable by specific terms or by sections. The database is also interactive, allowing users to submit data from additional studies and reports.
Sources of U.S. Longevity Increase 1960-2001, by Frank R. Lichtenberg, The Quarterly Review of Economics and Finance, Vol. 44,
No. 3, July 2004
This empirical analysis provides support for the hypothesis that both medical innovation (in the form of new drug approvals) and public health expenditure contributed to longevity increase during the period 1960–2001. Longevity is viewed as the output of the health production function, and output fluctuations as the consequence of fluctuations in medical inputs (expenditure) and technology. The estimates imply that the public health expenditure needed to gain one life-year is about $9640, and that the pharmaceutical R&D expenditure needed to gain one life-year is about $926.
Executive Summary: Too Many Drugs? The Clinical and Economic Value of Incremental Innovations, by Albert Wertheimer, Richard Levy and Thomas O'Connor, 2001
Some believe that incremental advances within the pharmaceutical industry are too costly and do not ultimately benefit the consumer. This is a misconception. The new agents resulting from this evolutionary process can offer advantages in terms of improved efficacy, better patient satisfaction and compliance and, in some cases, greater cost effectiveness.
Annotated PowerPoint slides related to this report are available.
CD-ROM The Value of Medical Innovation
This collection of materials on the increasingly important role of pharmaceuticals in health care delivery includes selected research from the Health Affairs September/October 2001 issue, video highlights from the September 7, 2001, Capitol Hill symposium held to discuss research featured in the issue, key points from the research, illustrative charts, and selected news articles covering the research and its implications.
Why Investing in Health Care Enhances Employee Productivity, by Dennis Richling, MD, Workforce Management, November 2004
Yes, rising health-care costs continue to present a significant challenge to companies. Still, it's important to resist the temptation to cut back on health-care spending. Doing so can cost you dearly in terms of productivity. Businesses should recognize that human capital is an asset. Investing in that asset requires more than the traditional approaches can offer.
Your Pharmacy Benefit: Make it Work for You!
This 16-page booklet, available through the Federal Citizen Information Center offers helpful advice for those with prescription drug coverage through and employer, union, or other group plan, or who are eligible for prescription drug coverage under Medicare. The booklet guides readers through important questions to ask and things to consider when choosing a plan, and offers tips for troubleshooting problems filling prescriptions once enrolled in a plan. Includes a sample appeal letter. Also available in Spanish.
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