Effects on the cost and utilization of proton pump inhibitors from adding over-the counter omeprazole to drug benefit coverage in a state employee health plan.

Abstract

To evaluate the financial effects in a state employee health plan of a change in the drug coverage policy to include over-the-counter (OTC) omeprazole in a tier-copayment drug benefit design that favored the OTC drug. The policy change in the Arkansas State Employee Benefit Division (EBD) involved 2 principal parts: OTC omeprazole placed in a new OTC copayment tier (5 dollars) and an increase in pharmacy reimbursement to a 13 dollars dispensing fee for each OTC omeprazole prescription. The prescription claims database was used to examine utilization and cost data for beneficiaries who received prescriptions for a proton pump inhibitor (PPI) during the 2-month period (January and February 2004) preceding the change in policy to cover OTC omeprazole compared with the 2-month period following the policy change (March and April 2004). During the first week of the new policy (March 1-7, 2004), OTC omeprazole accounted for 47% of all PPI claims. From the third week through the end of the 2-month study period, OTC omeprazole represented 60% of PPI claims. This shift to OTC omeprazole from prescription PPIs produced EBD average savings of 40.86 dollars (40.5%) per PPI claim in the first 2 months after implementation of coverage of OTC omeprazole compared with the immediate previous 2-month period. The average copayment savings for EBD beneficiaries were 4.20 dollars (16.5%) per PPI claim. The average increase in pharmacy reimbursement was 118% (6.27 dollars per claim in the postperiod versus 2.88 dollars per claim in the preperiod). Despite a 17.2% increase in utilization as measured by days of PPI therapy per member per month (1.91 PMPM) in the postperiod versus 1.63 in the preperiod, EBD savings were 2.11 dollars (38.9%) PMPM. Based upon PMPM savings of 2.56 dollars in the second month of coverage of OTC omeprazole, annual savings would be about 3,978,240 dollars for average eligible membership of 129,500 in this state employee health plan. This policy change to include coverage of OTC omeprazole in the state employee drug benefit plan produced savings to the state of as much as 50% of the total cost of PPI drugs despite an apparent small increase in utilization of PPIs and an increase in pharmacy reimbursement of more than 100%. Plan beneficiaries realized significant savings on average for PPI drugs and particularly for each OTC omeprazole prescription.