A new survey of 47 healthcare C-suite executives found that drug spending has increased among healthcare leaders. That trend, the report’s authors say, will only increase in the coming years, and health system leaders will need strategies to cope with the burden.
A new survey of 47 healthcare C-suite executives (including CEOs, CFOs, CMOs, and others) conducted by Premier Inc. found that drug spending has increased among healthcare leaders. That trend, the report’s authors say, will only increase in the coming years, and health system leaders will need strategies to cope with the burden.
According to 96% of the C-suite respondents, their hospitals or health systems had either “somewhat increased” or “significantly increased” their overall pharmacy spending, and 95% reported that they had experienced higher drug prices. More expensive specialty drugs were identified as primary contributors to organizations’ pharmaceutical spending by 91% of those surveyed.
To help manage rising costs, 89% of respondents said they expanded use of generic drugs if available, while 82% said that they had tightened their formularies. Pharmacists were called upon by 75% of respondents to provide guidance on expensive drug use patterns and to discuss therapeutically equivalent alternatives, and 75% of those surveyed had educated physicians in drug use management and cost-savings measures, encouraging providers to use generics and higher-value therapeutic alternatives to costly drugs.
A much lower percentage (59%) of C-suite leaders reported using generics for automatic substitution. Fewer still had adopted biosimilars—only 55% of respondents indicated that they had used available biosimilar treatments as alternatives to more expensive reference products.
When asked to estimate the rise in drug prices over the coming 5 years, 95% of those surveyed believed that prices could jump by over 10%, while 16% estimated that prices could climb by at least 30%.
Michael J. Alkire, COO of Premier Inc, said,“Healthcare leaders must think creatively and optimize prescribing methods to ensure a positive outcome at a manageable cost.”
With a growing biosimilar pipeline, and with the potential for payers and patients alike to realize cost savings through the use of biosimilar therapies, one such strategy that leaders may adopt is greater provider education in the use of biosimilars as alternatives to costly biologics.