The New Jersey Mandated Health Benefits Advisory Commission (MHBAC) recently released its report on S-1313, legislation that requires coverage for abuse deterrent opioid (ADO) drugs at the health insurer’s lowest level of cost-sharing. The MHBAC provides an independent analysis of the social, medical, and financial impact of proposed legislation and NJBIA thanks Senator Vitale, the bill sponsor, for requesting MHABC review. The bill applies to the commercial individual, small group and large employer markets, as well as the New Jersey public employee health benefits plans. You can view the full report here.
The report highlights the following social, medical and financial impacts:
Social Impact
- Coverage for ADOs is already available in the state because NJ Department of Banking and Insurance (DOBI) rules require pharmacy plans include all FDA approved drugs; however the price of an ADO can exceed the price of the non-ADO version significantly.
- DOBI rules cap co-pays for all drugs, which means a less impactful financial hardship on consumers.
- An insurer’s ability to negotiate costs from manufacturers could be restricted because higher cost ADOs must be covered at the same cost-sharing level as lower cost alternative opioids.
- Studies suggest ADOs have had a positive social impact in reducing immediate fatalities in children after accidental ingestion, and reducing prescribing errors by clinicians.
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Medical Evidence
For several reasons, ADOs are not the panacea for opioid addiction because:
- They are more expensive compared to other formulations;
- They are not fully abuse-resistant and can be abused orally;
- There are the unanticipated associated risks of increasing heroin and fentanyl abuse when individuals switch to these cheaper alternatives; and
- There is the potential for increased rates of diseases like HIV and Hepatitis B and C when ADOs are melted down and injected with shared needles.
Financial Impact
After year one, estimated costs increase from $111 to $118 million and steadily increase to $203 million by year 10, based on the assumption that prescription opioid drug prices will increase by 7 percent annually.
Conclusion & Strategies
- The empirical evidence on ADOs is inconclusive and sometimes contradictory. Some research indicates that abuse-deterrent properties can reduce overdose deaths. Others have found that the abuse-deterrent properties by themselves do not prevent addiction, and that ADO formulations can drive users to cheaper and more lethal alternatives, such as heroin and fentanyl.
- The latest CDC guidelines do not find current persuasive empirical evidence that ADOs are compelling alternatives to non-ADO formulations and do not suggest that expanded use of ADOs will significantly impact the opioid epidemic.
- Broad education outreach to prescribers is necessary. One study found that nearly half of the physicians surveyed mistakenly believed that ADOs were less addictive than non-ADO formulations.
- The expense of mandating the availability of ADOs at the lowest cost sharing levels will likely result in higher insurance costs.
- Public health experts urge a broad-based, multi-faceted approach, rather than a narrow focus on the single element of expanding the availability of ADOs as a more significant way to address the opioid crisis.
