LINCOLNSHIRE, Ill. (August 27, 2015) – A new survey of 60 leading health care vendors by Aon plc (NYSE: AON) shows that pharmacy trends are expected to continue in the double digits, with specialty pharmacy trends experiencing the most significant increases. The survey represents expected cost increases before plan or benefit changes for medical and pharmacy policies that carriers are renewing in 2015.
Pharmacy cost trends, including specialty drugs, are expected to increase 10 percent, up from 6.3 percent in the prior year. When separating out specialty pharmacy drugs, estimated cost trends have jumped to a whopping 22.7 percent in 2015, up from an18.2 percent increase in 2014.
“There is a robust pipeline of specialty drugs, which is contributing to the dramatic spike we see in cost trend,” said John Malley, leader of Aon Health’s Innovation Pharmacy Team. “Oncology drugs have been filling the pipeline and will be the largest category of specialty drug approvals in the near future. Specialty drugs for cholesterol may also have a significant impact, given that the market has not had this type of drug for such a prevalent disease state before.”
Medical trend expectations moderate
While pharmacy rate increases continue to rise significantly, carriers are expecting moderate medical cost increases. Trends used by vendors for projecting year-over-year increases in medical plan costs range from 7.0 percent to 7.6 percent in 2015, compared to 7.7 percent to 9.0 percent in 2014.
“Carriers continue to see price inflation as the single largest driver of increased medical costs, but an aging population, unhealthy lifestyle choices and provider consolidation are also contributing to the trend increase,’ said Tim Nimmer, global chief actuary for Aon Health. “As a result, employers are still gravitating toward managing year-to-year cost increases while keeping an eye on the near future to understand what new tools may be applicable to their specific workforces as a means to reduce health care spend.”
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