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Cheryl Larson Discusses Employer Initiatives to Battle Costs of Care


Cheryl Larson, president and chief executive officer of the Midwest Business Group on Health, discusses the sticker shock of rising specialty drug costs and how biosimilars are going to be incorporated into efforts to push back against this medical inflation.

Improving quality of care and value of care is paramount for the Midwest Business Group on Health, and biosimilars are a big part of their initiative this year. The group made its case at the 2020 Community Oncology Conference, a virtual presentation hosted by the Community Oncology Alliance (COA). The MBGH represents medium large and large self-insured public and private employers.

“Employers are the real payers of health care. It's not the PBMs [pharmacy benefit managers]. It's not the health plans or the carriers. We are the ones that are providing coverage for about 56% of all people that have benefits in the United States. That is more than the government. So, it's very important to us that we ensure that high-quality, safe, and effective care is provided to employees and their families and also that care is affordable,” Cheryl Larson, president and chief executive officer of MBGH, told The American Journal of Managed Care® in a 2-part interview.

The Community Oncology Conference replaced the annual meeting of COA this year as a result of the coronavirus disease 2019 (COVID-19). The COA virtual conference took place April 23rd and 24th.

In the interview, Larson discusses the perception that employers have been exploited by wasteful practices, misuse, and low value care in the medical community, which she says have been driving up costs each year.

“Our goals are to bring leading best practices to our employer members, to connect them with their peers to learn and share information with each other and benchmark against each other,” Larson said.

One thing that has irked the employer community is the skyrocketing prices for biologics and other specialty drugs, she said. About 11 years ago, the MBGH really began to start worrying about these higher expenses and what they were doing to corporate budgets. “And 11 years ago, [these prices] were not even what they are today. So, we started looking at what we could do to educate the employer community. We have an employer task force that drives the direction of the project,” Larson said.

“We created an online toolkit that any employer in the country can have access to. And we provided checklists and things to ask your health plan, things to ask your PBM about making sure that you have the right plan design. And over time, we realized that there was little movement or willingness to change by PBMs and other intermediaries in the market. And so we started creating reports and changing what we were asking vendors, to get them to do things that would be more transparent and ethical,” she said.

Consolidation of pharmacy benefit managers has deepened the cost crisis, because with fewer and larger PBMS, there is a consequent loss of transparency, Larson said.

To fight back, “employers absolutely need education on how to effectively manage specialty drugs and biologic drugs and now biosimilar drugs. So, we have focused on education and some small research projects and creating reports to tell the truth,” she said.

“This year alone, we're going to focus on genomic medicine; and again, biosimilars, as there are more and more coming into the market. We're going to focus on drugs that are running through the medical benefits, because for a lot of employers, that's a black hole. They can see what's running through the pharmacy benefit, but not through the medical benefits, because they're often told ‘We can't share those data with you. That would expose our provider contracts.' Of course, that's not necessarily true.”

To read part 1 and part 2 of this interview, visit AJMC.com.

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