Rising Mental Health Drug Costs: How Should Managed Care Respond?

Sheila Fifer, PhD; Patricia Marken, PharmD; Joyce Kamanitz, MD; Antohony Kotin, MD; Norrie Thomas, PhD, MS, RPh

In This Article

Abstract and Introduction

Magellan Health Services, a leader in the management of behavioral health care, convened a panel of mental health experts to discuss utilization and costs of outpatient mental health drugs. The advisors identified 3 trends driving the increase in use of behavioral health medications: treatment plans using multiple medications, greater awareness and desire for treatment on the part of patients, and increased recognition of underlying behavioral disease and of underlying emotional problems related to common chronic medical conditions. The panelists recommended that managed care decision makers weigh the costs of medications against the impact of medication use on overall patient outcomes and that they offer intervention techniques to facilitate patient access to appropriate pharmacotherapies.

Mental health drugs represent one of the fastest- growing cost categories in outpatient managed health care. Medications such as antidepressants, antipsychotics, and mood stabilizers now account for up to 25% of all pharmacy spending by commercial health insurers and 30% to 35% of all pharmacy spending by public payers.[1] Mental health outpatient drug costs have risen roughly 20% a year in each of the past 5 years for which national data are available (1996-2001). This level of annual increase is consistent across various data sources—payers' pharmacy claims, federal household surveys, physicians' office prescriptions, and pharmaceutical company sales reports—used to track drug costs and utilization.[2,3]

Increases in pharmaceutical expenditures vary across therapeutic classes and among patient groups. Costs of antipsychotic agents used by Medicare beneficiaries aged 65 years or older have shown the highest rate of increase at 71% per year. Even the lowest rate of increase of 18% per year for antidepressants (SSRIs and SNRIs) for those with private insurance and Medicaid is substantial.[2]

Health care decision makers need to weigh the increase in drug expenditures for new psychotropic drugs against the clinical and economic benefits both to individuals and to society.[4]

Roughly two thirds of the cost increase is reported to result from a rise in the number of drugs prescribed per patient; the remaining third is from increased numbers of patients receiving prescriptions for mental health medications.[2] Interestingly, rates of outpatient visits—at which these prescriptions are presumably initiated, monitored, and managed—appear to be either stable or declining.[5]

Magellan Health Services maintains a Clinical Work Group (CWG) composed of psychiatrists, psychiatric pharmacists, and data managers from academia, managed care, and community practice (Sidebar). This group meets with Magellan senior staff each quarter to discuss pharmacy policy and to provide recommendations for interpreting trends in drug use. Magellan asked this expert panel to interpret these trends and recommend ways in which managed care can better support use of mental health medications. Questions posed to the panelists and their responses at a discussion held on April 21 in Charlotte, NC, are summarized below.


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