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New Categories Give Employers More Options for Drug Benefit Plans

Traditionally, employer-provided prescription drug coverage focused on just that -- prescription drugs.

But as many common prescription drugs, most recently Zyrtec®, become available over the counter without a prescription, employers are increasingly interested in the cost savings associated with over-the-counter (OTC) drugs.

"The increase in the types of drugs available over the counter is really changing employer-provided coverage plans," said Brian Bullock, president and CEO of The Burchfield Group, a consulting firm that helps employers and other plan sponsors control the costs of providing prescription drug benefits.

 "For employers that want to maintain a good set of benefits and coverage for their employees, the lower costs of many OTC drugs make it relatively painless for an employer's plan to cover those drugs," he added.

Meanwhile, the U.S. Food and Drug Administration is considering the official establishment of a third class of drugs, referred to as "behind-the-counter" (BTC) drugs.

These drugs are available without a prescription but only through direct contact -- and perhaps a brief consultation -- with a pharmacist.

When deciding how to handle OTC and BTC drugs, employers need to consider a variety of variables, including members' current drug usage and the company's goals for coverage and costs.

The BTC classification is still unsettled territory, so the current focus is on developing effective approaches to managing coverage for the two existing categories of OTC and prescription drugs.

"Employers have three general approaches for how to handle OTC drugs," said Cory Belken, a senior consultant at The Burchfield Group and, like Bullock, also a pharmacist.

"As OTC drugs become a larger part of their members' usage habits, employers can simply leave their plans alone and some utilization will naturally migrate to OTC drugs. They can also restrict the use of prescription drugs in a particular category to encourage OTC use, or they can implement a 'step therapy' plan that requires patients to first use OTC drugs when appropriate before moving to prescription drugs," Belken added.



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