Login Register
Contact us

COVID-19 and the Pharmacy Benefit Plan

August 18, 2020 by Employers Health Team

COVID-19 has caused a devastating impact to employers and their employees around the country. Governments have implemented drastic measures to curb viral spread and protect public health. The implementation of these policies – quarantine, reduction in non-essential medical services and closures of businesses – have altered the way Employers Health plan sponsors and their plan participants consume health care services, including pharmacy utilization and medication management.

Initial residential quarantine policies were enacted in March and coincided with a 13% increase in prescription fills for Employers Health pharmacy benefit purchasing clients. These trends are likely the result of an anticipated health care system burden, as well as relaxed “refill-too-soon” restrictions on medications to help prepare patients for long periods of isolation. In parallel, our data show an 11% increase in days’ supply per prescription compared to pre-pandemic levels. This increase was primarily in the retail channel, likely indicating that utilizers are stockpiling medications in preparation for the quarantine. Conversely, the days’ supply through mail was largely unaffected. However, our data did show a small increase (3.3%) in mail prescriptions. We anticipate that utilizers will continue to shift to 90-day and/or mail prescriptions as this channel allows for greater convenience, lower exposure to the virus, and a larger quantity of drug dispensed per prescription. One major limitation to patients utilizing this channel are the higher out-of-pocket costs for participants with a 90-day medication, particularly those with high deductibles or coinsurance.

Conversely, the reduction and cessation of non-essential medical services likely contributed to overall decreases in prescription fills from April until late June. In line with this concept, our data show a 14% increase in prescription numbers in July, corresponding with the reopening of medical providers and increased availability of non-emergency medical services.

Business closures and other negative economic consequences of the pandemic (e.g. budget cuts, furloughs and layoffs) have contributed to the overall decrease in utilizing members and total members on many pharmacy plans. Unlike prescription counts, company-sponsored pharmacy plan members have declined. At the start of the third quarter, Employers Health plan sponsors had 3% fewer utilizers than at the beginning of 2020. This result may be caused by changes in company policies, institution of furloughs and reduction of their workforce in efforts to cut costs and remain solvent.

In addition to the changes in pharmacy utilization, Employers Health plan sponsors saw an 18% increase in drug spend on therapies used to treat COVID-19 complications, such as anti-asthmatics. Despite this increase, the average monthly cost per member, for our book of business on all medications, was 1% lower in the second quarter of 2020 compared to the first quarter of 2020. We found no overall changes in chronic classes; there may have been some increases due to COVID-19, however, this increase was likely offset by decreases in other areas, such as a reduction in acute prescriptions tied to non-essential medical appointments, etc.

We cannot determine with certainty how long these changes in drug purchasing behavior, such as the increase in days’ supply, the shift to mail prescriptions and the increase in COVID-19 therapies, will continue. Nevertheless, we do anticipate further increases in 90-day utilization since people generally appreciate the convenience and safety of ordering prescriptions from home and reducing pharmacy visits through longer days’ supply. Finally, we expect other subsets of pharmacy utilization to increase, such as flu vaccines, as COVID-19 specific treatments, vaccines and other beneficial therapies are developed and approved.

Related Resources

Cassidy Burger

Empowering Professionals, Enhancing Benefits: 2024 Annual Benefits Forum

“We are in this field because we care about people and want them to live...

Learn More
Hannah Whitesel, PharmD

The Value and Role of Prior Authorizations in Modern Health Care

Employer-sponsored insurance has evolved significantly over the past century. Beginning with prepaid health insurance at...

Learn More
Madison Connor, J.D., CEBS

The Latest in Pharmacy Benefit Legislation

In the past year, state legislatures introduced hundreds of bills regarding pharmacy benefit plans, while...

Learn More

Subscribe For Updates

Subscribe to our mailing list to receive our monthly eNotes, e-newsletter, health benefits event info and more.