Economics of Hemophilia

Hemophilia and Bleeding Disorders Toolkit

Building the Business Case : Economics of Hemophilia

Recent research identifies hemophilia as a leading high-cost claimant condition for people in their prime working years, between the ages of 20 and 39. This chronic condition is a disproportionate driver of health care spend, frequently appearing in an employer’s top 10 catastrophic claims report. The high cost is mainly due to the necessary use of specialty drugs to manage and treat the condition. The average annual cost of medication to treat hemophilia is more than $270,000 per patient, accounting for an estimated 90% of total direct medical costs. This amount can increase significantly depending on disease severity, comorbidities and whether inhibitors are present. If complications arise, the yearly price tag can soar to over $1 million dollars.

The total cost of care can skyrocket when members with hemophilia are unmanaged or undermanaged, resulting in avoidable use of services and treatments, including emergency room visits and hospitalizations. This can happen when members are treated by health care professionals lacking the ongoing training or expertise to effectively treat and manage hemophilia.

Medical claims for people with hemophilia A, the most common type, are approximately five times higher when compared with the non-hemophilia population. By comparison, cancer is often the number one high cost claimant condition for employers based on frequency and cost of claims. However, despite it affecting significantly fewer members, the average cost of treatment for hemophilia is more than three times higher than that of cancer.

Hemophilia Cost Drivers

Even though hemophilia is a rare disease, the related high cost of care may leave employers seeking ways to better manage costs without knowledge or sufficient data guiding them on where to begin. There are three major areas driving cost in this space:

  1. Provider/Site-of-Care: As with other high cost conditions that involve expensive treatments, hemophilia requires a high-touch approach to patient care to achieve optimal outcomes.
  2. Medication Management: Hemophilia treatment generally involves the infusion of clotting factor replacement products, which represents upwards of 90% of the member’s total cost of care. Since these are biologic drugs, prescriptions are written in a way that does not follow traditional dosing. Clotting factor is made in batches and provided to pharmacies in a variety of vial sizes. Dispensing pharmacies choose the vial size closest to the patient’s prescribed dose, which can lead to over-shipping of product and excess cost to the employer. To further complicate medication management, the script dosage is based on many factors, including a member’s weight.
  3. Prescription/Adherence Management: Patient non-compliance can contribute to poor outcomes and even death. In addition, significant cost implications can result from bleeding episodes that lead to unnecessary ER visits, hospitalizations and complications from bleed-related joint damage. To help reduce waste and minimize health care costs, communication and coordination between the medical care provider, pharmacy and the patient are paramount.

These high cost drivers can be addressed through a variety of strategies, including use of a benefit plan design that drives members to the highest quality, most cost-effective site of care for treatment and ensuring your health plan and PBM are appropriately managing clotting factor treatment for each patient.

Waste & Misuse

In past years, few drugs existed to effectively treat and manage hemophilia. Therefore, hemophilia patients often kept more medication on hand than what is needed to manage their condition. Fear of running out of medication led to stockpiling.

Today there are more treatment options available for hemophilia than ever before, yet stockpiling and other forms of waste still occur. This is mainly due to lack of oversight over the amount of product going out the door. There is tremendous waste of clotting factor by the middlemen (e.g. PBMs and specialty pharmacies) involved in delivery and administration of the factor, which ultimately carries a big price tag for employers. Prescriptions for clotting factor are typically written for + or – 10% of the fill. When the maximum amount is filled every time, it leads to the patient having excess clotting factor on hand.

Here is a real-life example: A patient in his mid-twenties with hemophilia is prescribed 2,500 units of clotting factor 3x/week based on his weight. Guidelines allow specialty pharmacies to ship additional clotting factor at +/- 10%. Suppliers almost always take advantage of this and employers are often not aware that additional factor is being shipped. This can cause waste as the patient now has an extra 750 units (250 units X 3) sent to him every week. If the prescription was followed at 2,500 units without the added 10%, the patient would have all the clotting factor he needs.

This process has a significant financial impact. Consider the price tag of the case above:

  • The average cost for clotting factor per unit = $1.30
  • 2,500 units x $1.30 = $3,250 x 3 vials/week x 52 weeks - $507,000 (needed to control the patient’s hemophilia)
  • 250 units x $1.30 = $325 x 3 vials/week x 52 weeks = $50,700 (added “waste”)