Sales of lifestyle drugs are booming.

Fueled by growing demand from an aging population, the market for drugs used to treat conditions such as infertility, hair loss, erectile dysfunction, obesity and wrinkles has grown to more than $23 billion.

When you, the producer, visit employers that sponsor self-insured health plans, you may find that managers are on one side of the benefits fence, shaking their heads at a new round of double-digit increases in prescription drug expenditures.

The employees are on the other side of the fence, asking why their employers wont cover the cost of nicotine patches that could ultimately decrease the cost of treating lung cancer. Or why their employers will cover antibiotics for minor earaches but wont cover creams used to treat disfiguring acne.

How can you help your clients break down that fence?

To develop a consistent policy that will meet the wants and needs of a plans members while ensuring that plan resources are allocated appropriately, the plan sponsors will have to consider each lifestyle drugs safety, efficacy, outcomes and cost.

One problem with coping with the cost of lifestyle drugs is the fact that there are no clear-cut guidelines for deciding which drugs should be classified as lifestyle drugs.

Keep in mind is that the term “lifestyle drug” could refer to an off-label use of a drug used to treat a serious medical condition.

Lifestyle drugs include drugs used primarily for cosmetic reasons; drugs for conditions that might not necessarily be medical problems, such as erectile dysfunction; and drugs that treat medical conditions that many people believe to be the result of poor lifestyle choices, such as smoking cessation drugs and weight loss drugs.

Not surprisingly, coverage of lifestyle drugs varies greatly from one plan sponsor to the next.

A study by Deloitte & Touche L.L.P., New York, showed that plans often provide some coverage for drugs used to treat obesity and sexual dysfunction, but that plans rarely provide any coverage for drugs used to treat hair loss and signs of aging.

Plan sponsors that are considering adding coverage for lifestyle drugs would do well to call in the services of a PBM.

Most PBMs can help plan sponsors by providing data regarding the safety, efficacy, cost and outcomes associated with lifestyle drugs. Some PBMs offer more in-depth claims analysis services, and some can use sophisticated predictive modeling software to estimate the effects of adding or deleting coverage for certain lifestyle drugs.

In deciding whether to cover a certain lifestyle drug, plan sponsors will want to know whether valid studies have shown that the drug is safe and effective. Sponsors also will want to know about the impact of adding the drug to the formulary on productivity, absenteeism and perceptions of fairness.

Plan sponsors often use “tiers” to provide higher reimbursement rates for the most important, least expensive drugs and lower reimbursement rates for drugs that are less cost-effective.

Other options include:

o Limiting plan beneficiaries to buying a set number of units of a lifestyle drug or requiring members to buy the drug within a defined period of time.

o Capping the reimbursement level at a fixed amount, such as $500 or $1,000 annually per beneficiary.

o Excluding co-payments and deductibles for lifestyle drugs from accrual toward the health plans annual pharmacy deductible.

o Encouraging the use of a low-cost mail-order pharmacy by offering higher reimbursement rates for beneficiaries that use the mail-order pharmacy.

o Creating a stand-alone rider to cover lifestyle medications. That way, employees who want coverage for lifestyle drugs can pay for the coverage themselves.

Sheela Andrews, Pharm. D., is director of client management for Prescription Solutions, Costa Mesa, Calif., a pharmacy medical management company that manages prescription drug benefits for employers and unions as well as for commercial, Medicare and government health plans. Her e-mail address is information@rxsolutions.com


Reproduced from National Underwriter Edition, April 19, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.