#HealthBenefitsTrends
Data Trends and National Benchmarks Retrospective 2019
Shawn O’Brien
Principal – TELUS Health
2
I. Terminology and background
II. Key results
III. Drug type utilization
IV. Specialty drug analysis
V. Therapeutic category rankings
VI. Plan design trends
Content outline
3
Terminologyand definitions
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• Insured: any covered dual i.e. employee, spouse or child
• Certificate: the employee and the linked dependants
• Average age: average age of the insureds
• Utilization: number of claims paid per certificate or insured depending on the context
• Eligible cost: the cost of the drug considered eligible by TELUS Health. This measure does not take into account any cost sharing (deductible, co-insurance)
Terminology and background
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Comparison with a specific group
• Results reflect the entire TELUS Health book of business (BoB)
• Results may differ significantly from plan to plan. The following elements have an important impact on the costs:
• Plan coverage
• Demographics:
• Age distribution
• Gender distribution
• Number of dependants
• Provincial distribution
• Industry
Terminology and background
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Comparison with a specific group (cont.)
For renewal, the factors used by carriers are based on many other elements:
• Group experience
• The entire medical claim not only drugs (including hospital, paramedical, out-of-country, etc.)
• Higher volatility for a specific group compared to TELUS Health BoB
• Ageing of insured population
• Changes in insurers manual rate
• Renewal is a prospective exercise, our analysis is retrospective
Terminology and background
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• Single-source brand –drug for which no generic exists
• Multi-source brand –one or more generics exist
• Generic –bioequivalent drug that is a copy of the innovator molecule
Terminology and background
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Except if otherwise mentioned, data in this presentation is based on:
• Insured aged less than 65
• Additional comparisons excluding OHIP+ ages (24 and younger) considering that OHIP+ was primary payer until April 2019
• Costs are eligible costs, i.e. before deductible and co-payment
• Regional comparisons are made where applicable
Terminology and background
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Terminology and background
Ontario Outside Ontario Canada
2019 Trend 2019 Trend 2019 Trend
TELUS Book of Business –All ages
TELUS Book of Business – Change in number of certificates 2018-2019
2,118,000 1.5% 2,771,600 4.8% 4,889,500 3.4%
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Key results
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Key results by region – insureds age 25-64 l 2019
*
Canada West Ontario Quebec Atlantic
Eligible monthly cost per insured
Average eligible cost per claim
Monthly utilization per insured
% generic (# of Rx)
Average age of insured*
$54.01 $40.85 $55.91 $72.40 $67.09
$75.02 $70.35 $85.72 $61.22 $85.56
0.72 0.58 0.65 1.18 0.78
63% 66% 61% 63% 70%
44.0 43.3 44.4 44.3 45.3
* Age 0-64
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Change in eligible monthly costs per insureds age 0-642018 to 2019
7.6 %
4.0 %
10.2 %
5.8 %
4.2 %
-2%
0%
2%
4%
6%
8%
10%
12%
Canada West Ontario Quebec Atlantic
2019 42.0 40.9 42.5 42.6 43.6
2018 42.1 40.9 42.8 42.4 43.9
Average age of Primary Certificate
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Change in eligible costs per claim – insureds age 25-642018 to 2019
3.3%
2.5%
3.6%
4.5%5.0%
-1%
0%
1%
2%
3%
4%
5%
6%
Canada West Ontario Quebec Atlantic
2019 44.0 43.3 44.4 44.3 45.3
2018 44.1 43.3 44.5 44.4 45.3
Average age of Insured
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Change in monthly utilization – insureds age 25-642018 to 2019
1.7%
1.0%
1.7%
0.3%
-0.3%
-1%
0%
1%
2%
3%
Canada West Ontario Quebec Atlantic
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Change in eligible monthly costs – insureds age 25-642018 to 2019
5.1%
3.5%
5.4%
4.8% 4.7%
0%
2%
4%
6%
8%
7.6%4.2%
4.0%
5.8%
10.2%
Canada West Ontario Quebec Atlantic
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Annual Trend Components – insureds age 25-642018 to 2019
5.1%Overall Trend
10.1%Specialty
Trend
2.9% Traditional
Trend
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Annual Trend Components – insureds age 25-642018 to 2019
1.7% 1.2% 2.9%
UtilizationAverage Cost Per
Claim Annual Trend
7.8% 2.1% 10.1%
1.7% 3.3% 5.1%
Traditional Drugs
Specialty Drugs
Overall
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Monthly eligible cost per insureds by age band 2019
$14.44$21.39
$34.14
$51.98
$74.74
$98.60
$0
$20
$40
$60
$80
$100
$120
<25 25-29 30-39 40-49 50-59 60-64
Canada
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Monthly cost variation per insureds by age band2018 to 2019
27.9%
11.6%
4.9% 5.8% 5.0% 3.7%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
<25 25-29 30-39 40-49 50-59 60-64
Canada
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Drug type utilization
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Generic utilization l Per region – as % of Rx
57%
59% 59%60%
61%
64%
67% 67%69% 70%
50%
60%
70%
2015 2016 2017 2018 2019
Québec Ontario West Atlantic
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Multi-source brand utilization l Per region – as % of Rx
14%
11%
9% 9%8%
6%5%
4% 4% 4%2%
4%
6%
8%
10%
12%
14%
2015 2016 2017 2018 2019
Québec West Ontario Atlantic
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Utilization percentage by type of drug l #Rx
58% 60% 61% 62% 63%
33% 32% 32% 30% 29%
9% 8% 7% 7% 7%
0%
10%
20%
30%
40%
50%
60%
70%
2015 2016 2017 2018 2019
Generic Single-Source Brand Multi-Source Brand
Canada
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Paid percentage by type of drug l eligible amount
Canada
26% 27% 26% 26% 25%
67% 67% 69% 69% 70%
8% 6% 5% 5% 5%
0%
10%
20%
30%
40%
50%
60%
70%
80%
2015 2016 2017 2018 2019
Generic Single-Source Brand Multi-Source Brand
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Specialty and biosimilar drugs
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A TELUS Health specialty drug is a drug that has a high cost based on a potential per patient amount exceeding $10,000 per year
Further characteristics of these drugs may include but are not limited to:
• Requires special medication delivery (e.g. special handling, preparation, administration, storage, or distribution)
• Requires complex treatment maintenance (e.g. complex disease, complex dosing, intensive monitoring & clinical management etc.)
Specialty drug definition
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Specialty drugs l less than 65
Canada
0.9% 0.9% 1% 1.1% 1.1% 0.7% 0.8% 0.9% 0.9% 1.0% 1.1% 1.1%
11%12%
14%15%
18%19%
22%
25%26%
27%29% 30%
0%
4%
8%
12%
16%
20%
24%
28%
32%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
% of claimants % of total cost
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Specialty drugs l less than 65
23%
31%
34%
38%
9%
11%
11%
12%
5% 10% 15% 20% 25% 30% 35% 40%
BC/SASK./MAN.
ONTARIO
QUÉBEC
ATLANTIC
2008 2019
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Specialty drugs l less than 65 – monthly cost per certificate
Canada$78
$94
$0
$20
$40
$60
$80
$100
$120
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Total
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Specialty drugs l less than 65 – monthly cost per certificate
Canada$70 $66$78
$94
$0
$20
$40
$60
$80
$100
$120
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Non Specialty Total
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Specialty drugs l less than 65 – monthly cost per certificate
Canada
$9
$29
$70 $66
$78$94
$0
$20
$40
$60
$80
$100
$120
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Specialty Non Specialty Total
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Specialty drugs l less than 65 – monthly cost per certificate
Canada
$9
$29$55
$70 $66$64
$0
$20
$40
$60
$80
$100
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Specialty Non Specialty
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Specialty drugs l less than 65 – monthly cost per certificate
Canada
$9$29
$55$70
$66$64$78
$94
$119
$0
$20
$40
$60
$80
$100
$120
$140
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Specialty Non Specialty Total
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Specialty vs traditional drug split l % of eligible amount
Canada
0.1%
10.6%
3.2%4.5% 5.1%
0.9%
3.9%
12.0%
3.7% 1.1%
3.2%
12.1%
10.6%
6.9%
5.6%5.1%
4.1% 3.9%
0%
2%
4%
6%
8%
10%
12%
14%
RHEUMATOIDARTHRITIS
DIABETES SKIN DISORDERS ASTHMA DEPRESSION CANCER ADD/NARCOLEPSY
Traditional Speciality
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2.9%2.5%
3.3%
1.8%
0.0%
10.1%
6.3%
10.0%11.0%
12.7%
-2%
0%
2%
4%
6%
8%
10%
12%
14%Traditional Specialty
Change in eligible monthly costs – insureds age 25-642018 to 2019
Traditional vs
specialty
Canada West Ontario Quebec Atlantic
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Adherence l Canada all ages 2019
23.0% 24.8%
65.8%
16.2%
4.7%
11.3%
5.7%
7.0%
0%
2%
4%
6%
8%
10%
12%
0%
10%
20%
30%
40%
50%
60%
70%
Depression Diabetes Asthma Cardiovascular andCholesterol
% Non Adherent
% Total Eligible
* Non-adherent is based on a patient with a Medication Possession Ratio of less than 0.8
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Biosimilar New Starts - BC
13 2134
4660 62
80 90
120 129
188199
232
293 292
379
98115
133
177
227 230
261
297 293 300 302282
259 265 266247
SEP-18 OCT-18 NOV-18 DEC-18 JAN-19 FEB-19 MAR-19 APR-19 MAY-19 JUN-19 JUL-19 AUG-19 SEP-19 OCT-19 NOV-19 DEC-19
Number of new patients in British Columbia by month
BASAGLAR LANTUS
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Biosimilar New Starts - BC
4
8 7
12
15 16
20
2830 31
2729
35
26
33
2 1
6
3
2224
17 17 16
13
18
14
21
16 15 16
1 13
5
2
6
SEP-18 OCT-18 NOV-18 DEC-18 JAN-19 FEB-19 MAR-19 APR-19 MAY-19 JUN-19 JUL-19 AUG-19 SEP-19 OCT-19 NOV-19 DEC-19
Number of new patients in British Columbia by month
INFLECTRA REMICADE RENFLEXIS
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57 5661 61
71
7873
70
47
38 40 3834
39
32
38
2 4 37
10
18 16
23 24 2522
1620
SEP-18 OCT-18 NOV-18 DEC-18 JAN-19 FEB-19 MAR-19 APR-19 MAY-19 JUN-19 JUL-19 AUG-19 SEP-19 OCT-19 NOV-19 DEC-19
Number of new patients in British Columbia by month
COPAXONE GLATECT
Biosimilar New Starts - BC
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Drug Shortages
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19
RANITIDINE FAMOTIDINE
l Canada 2019
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Therapeutic category rankings
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Top 10 drug classes by eligible amount
Therapeutic class Rank by total eligible amount Percent of total eligible amount
2019 2018 2019 2018
Rheumatoid Arthritis 1 1 12.1% 12.1%
Diabetes 2 2 10.6% 10.0%
Skin Disorders 3 3 6.9% 6.1%
Asthma 4 4 5.6% 5.6%
Depression 5 5 5.1% 5.1%
Cancer 6 6 4.1% 3.9%
ADHD / Narcolepsy 7 9 3.9% 3.4%
Multiple Sclerosis 8 8 3.6% 3.6%
Blood Pressure 9 7 3.3% 3.8%
Antibiotics / Anti-Infectives 10 10 2.9% 3.1%
% of total eligible amount 60.8% 58.8%
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Top 10 products by eligible amount
Drug ProductRank by total eligible amount Percent of total eligible amount
2019 2018 2019 2018
Remicade 1 1 4.7% 4.7%
Humira 2 2 4.5% 4.5%
Stelara 3 4 2.0% 1.8%
Insulin 4 3 1.5% 1.8%
Vyvanse 5 8 1.3% 1.0%
Concerta 6 6 1.3% 1.2%
Freestyle Libre 7 40 1.0% 0.5%
Enbrel 8 5 1.0% 1.3%
Symbicort 9 9 1.0% 1.0%
Crestor 10 7 1.0% 1.1%
% of total eligible amount 19.3% 18.9%
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Plan design
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Generic substitution l # of insureds
Canada
20% 18% 16% 14% 13%
37%37% 35% 33% 31%
43% 45% 49% 53% 56%
0%
20%
40%
60%
80%
100%
2015 2016 2017 2018 2019
No generic Substitution Generic Substitution - Regular Generic Substitution - Mandatory
80% 87%
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Generic substitution l # of insureds vs # of groups
Canada
2019
Insureds Groups
Generic substitution - mandatory 56% 86%
Generic substitution - regular 31% 8%
No generic substitution 13% 6%
87% 94%
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Coinsurance l % of Certificates – Less than 65
Canada
32 %
13 %
43 %
12 %
31 %
13 %
46 %
10 %
0 %
5 %
10 %
15 %
20 %
25 %
30 %
35 %
40 %
45 %
50 %
100% 90% 80% Other%
2015 2019
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Annual Maximums l % of Certificates – Less than 65
Canada
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
1 - 2,500 2,501 - 5,000 5,001 - 10,000 10,001 -25,000
25,001 -50,000
50,001 -100,000
100,001 -250,000
250,001 -500,000
2015 2019
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Deductible l % of Certificates – Less than 65
Canada
10.0 % 10.0 %
14.0 % 13.0 %
76.0 % 77.0 %
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2015 2019
Annual Per Claim None0% 10% 20% 30% 40%
$0.01-1.99
$2-3.99
$4-5.99
$6-7.99
$8-9.99
$10+
Per Claim Deductible Amount
2019
2015
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Dispense Fee Cap l % of Certificates – Less than 65
0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0%
< = 4.99
5 to 5.99
6 to 6.99
7 to 7.99
8 to 8.99
9 to 9.99
10 to 10.99
11 to 11.99
12 to 12.99
13 to 13.99
14 to 14.99
15 to 15.99
16.00 +
2019 2015
Canada
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Formulary Type l % of Certificates – Less than 65
Canada
72 %
21 %
7 %
71 %
22 %
7 %
0 %
10 %
20 %
30 %
40 %
50 %
60 %
70 %
80 %
Open Managed Provincial
2015 2019
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Prior Authorization l % of Certificates – Less than 65
Canada
93 %89 %
7 %11 %
0 %
20 %
40 %
60 %
80 %
100 %
2015 2019
PA No PA
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Summary When focusing on the 25-64 age bands, the overall change in plan costs (based on monthly eligible
amount per insured) saw a 5.1% year over year increase across Canada. This increase was driven primarily by higher cost per claim with a lesser influence from increased utilization. However, on a region basis there are differences.
Plans that have a significant employee base in Ontario will see higher costs in 2019 and beyond, compared to 2018 given the repeal of OHIP+ in April 2019.
Specialty drugs now account for 30% of total eligible costs, but still resulting from just 1.1% of claimants. Specialty drug costs are trending much higher than traditional at 10.1% year over year.
We observed poor adherence across several chronic conditions. Although non-adherence can drive lower claim costs in that particular category, there is a risk of increasing costs downstream if the condition is not managed appropriately.
Chronic conditions and high cost treatments of more rare disease dominate the top drug class profile. Some of these categories, like RA and cancer, are propelled by high specialty drug costs in that category.
Continued slow but steady trend towards adoption of plan management features to contain costs. Additional levers to contain costs (PLAs, biosimilar strategies, high cost claimant and chronic disease management, etc.) will begin to emerge.
Questions
Thank you#HealthBenefitsTrends