Study of U.S. Commercial Health Plans Shows Widespread Variation in Coverage and Reimbursement for Specialty Medicines


Research published in Health Affairs shows that insurance coverage and reimbursement for specialty medications varies substantially, finding that only 15.9 percent of drug coverage policies were consistent across the largest U.S. commercial health plans. Less than half (48 percent) of all drug coverage decisions were consistent across 75 percent of health plans, according to the study by the National Pharmaceutical Council (NPC) and the Center for the Evaluation of Value and Risk in Health at Tufts Medical Center.

Among the study findings:

  • Health plans either did not cover or were more restrictive than the Food and Drug Administration (FDA)-approved indication for the medicine in 38 percent of the drug-indication cases. In terms of variation, the percentage of coverage decisions not providing coverage or more restrictive than the FDA label ranged from a low of 14 percent for one plan to a high of 62 percent for another.
  • Only one in six—or 15.9 percentof drug indication pairs were covered the same way across all plans.
  • “Step edits,” policies that require a patient to try one or more other medications first and fail on those treatments, were the most common access restriction imposed. On average, patients with plans incorporating step edits were required to try and fail 1.5 prior therapies before coverage of the specific medication indication was allowed. More than a third of these step edits required patients to try and fail on two or more medications before having access to the specific medication.
  • Other common coverage restrictions included limiting who could prescribe the medicine (e.g., a specific type of physician); and limiting coverage to certain patient subgroups.
  • When restricting coverage, plans applied multiple restrictions in roughly one in five cases.

Coverage was less restrictive for drugs indicated for a pediatric population, orphan disease, or cancer-related indication than drugs indicated for other diseases. Drugs had fewer coverage restrictions if they were administered by a physician, had no therapeutic alternatives, were approved under an FDA expedited review program, had no safety warnings, or were approved less recently.

These results demonstrate the impact health plans have on patient access to particular specialty medications. For patients whose conditions are controlled on one treatment, variation in specialty drug coverage between payers can affect access if the patient switches health plans or employers. For physicians, variation in coverage policies means they must not only consider their patient’s clinical presentation when exploring treatment options for patients, but also the various insurance coverage policies. Greater transparency in the underlying rationale for coverage decisions can provide clarity to patients, providers and specialty product manufacturers.

Study results were generated through a systematic review of coverage decisions contained within the Tufts Medical Center Specialty Drug Evidence and Coverage Database, which includes policies issued by 17 of the largest 20 commercial health plans for the most common specialty medications. The database includes how and when health plans cover the drugs, the evidence health plans cited in their policies, drug-level information (e.g., whether the drug has a black box safety warning), and whether the drug is a physician- or self-administered drug.

The database includes 158 drugs, 302 drug indication pairs (some drugs are indicated for more than one condition, such as chronic idiopathic urticaria vs. moderate to severe persistent asthma) and 3,417 coverage determinations.

This study is the first of several seeking to understand how, and based on what evidence, health plans provide coverage for biopharmaceutical products.