Duke Health Claims Costs on the Rise
17 percent increase in prescription drug costs leads the way
Tuesday, August 4, 2009
This story originally appeared in Working@Duke.
Durham, NC -- The cost of health claims among Duke employees and family members is growing at a much higher rate than last year because of rising medical costs and increased use of health care services and prescription drugs.
“Currently, we’re seeing an increase of somewhere between 9 to 13 percent from this time last year,” said Kyle Cavanaugh, vice president of human resources.
Prescription drug costs comprise a significant part of the increase with overall claims currently running 17 percent higher than last year. “One way to help reduce pharmacy costs is to use generic drugs when possible,” Cavanaugh said. “We’ve seen increased usage of generic drugs over the years, but we still have room for improvement.”
Cavanaugh said these higher costs will result in some changes to Duke health plans in 2010, but it is too early to determine how premiums, co-pays and out-of-pocket costs for 2010 plans will be affected.
“We are taking a comprehensive look at our plans – negotiating with providers and administrators and focusing on prevention strategies – to maintain their overall fiscal viability,” he said. “We do expect some level of plan design changes, but we are working to keep those to a minimum.”
Duke has maintained below average increases for health insurance for many years. Consultant PricewaterhouseCoopers recently announced survey results from U.S. employers indicating medical costs for employers would increase by 9 percent in 2010.
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“We’ve been successful the last several years at encouraging people to make better decisions about their health,” said Lois Ann Green, director of Duke Benefits. “People have taken advantage of programs such as Duke Prospective Health and LIVE FOR LIFE to improve their health and help keep our cost increases lower. We need to continue to be diligent in participating in these type of efforts if we are to mitigate future increases.”
Green recommends three ways people can improve health while reducing costs:
• Practice preventive health: Regular exercise, better nutrition, and an annual check-up with a primary care physician can help prevent significant health problems.
• Use mail order for maintenance drugs: Fewer than 25 percent of Duke health plan members on maintenance drugs take advantage of cost savings through mail order. If 70 percent of plan members used mail order for a 90-day prescription, they would collectively save $1.4 million.
• Appropriate use of health care facilities: The co-pay for a visit to a primary care physician is typically $20 less than the co-pay for an urgent care visit. Yet many still visit urgent care for illnesses and injuries that can be seen at a primary care physician’s office. Before going to urgent care, call your primary care doctor first for a same-day appointment.
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The annual open enrollment for benefits is Oct. 19-27 when faculty and staff can make changes and selections for health, dental and vision benefits for 2010.
