Summary of Key Points
Recently, there have been two significant developments in the commercial insurance innovation drug catalog: firstly, the expansion of the commercial insurance innovation drug catalog led by the National Healthcare Security Administration; and secondly, the near-implementation of an industry-specific catalog for commercial insurance drugs initiated by the Insurance Association. Both are advisory catalogs, but they serve different audiences (the former is connected to the "Huimin Bao" (people-benefiting insurance) program, while the latter targets pure commercial health insurance products like "Million Medical"). However, there are still many obstacles to the payment of innovation drugs through commercial insurance: poor interdepartmental coordination, conflicts between policy "eligibility" and commercial "affordability," and disruptions in the compensation process after the catalogs are implemented. The industry is calling for national-level strategic planning to break down these barriers and enable commercial insurance to truly play a crucial role in covering the costs of innovation drugs.
Detailed Analysis
1. Two Commercial Insurance Catalogs: Different Purposes, Same Goal
The National Healthcare Security Administration and the Insurance Association have each developed their own commercial insurance drug catalogs, which may seem like concurrent efforts but actually serve different purposes:
- Healthcare Security Administration Catalog: This catalog is primarily aimed at the "Huimin Bao" program, a type of social-commercial integrated insurance that focuses on providing affordable access to innovative drugs. It serves as a channel for connecting medical insurance and commercial insurance.
- Insurance Association Catalog: Designed for pure commercial health insurance products such as "Million Medical" and critical illness insurance, this catalog includes drugs that are frequently used based on historical compensation data (i.e., those that are in high demand by consumers and have proven efficacy but are expensive). Its main goal is to standardize the selection of drugs covered by commercial insurance (similar to a disease list for critical illness insurance, providing insurers with a unified reference when designing products).
Although both catalogs aim to reduce patients' out-of-pocket costs for innovation drugs, their approaches and criteria for selecting drugs differ.
2. The "Last Mile" of Commercial Insurance Payment for Innovation Drugs: Full of Challenges
Commercial insurance should be the final step in covering the costs of innovation drugs, but there are numerous issues at every stage:
- Huimin Bao: Many innovation drugs were included in local Huimin Bao catalogs last year, but the discounts promised by drug manufacturers (15%-50%) did not actually reach the insurers, leading to inaccurate cost calculations and increased compensation pressures for the insurance companies.
- Insurers: Insurers are caught in a difficult position; drug manufacturers want to negotiate prices, while patients expect higher compensations due to the discounts, putting them in a middle ground.
- Full Chain: Any disruption in the supply of drugs, prescription issuance by doctors, discount offers from manufacturers, or compensation processes can prevent drugs from reaching patients. For example, insurers are hesitant to cover new drugs without sufficient clinical data.
3. "Worth Covering" Does Not Equal "Affordable to Cover": A Conflict Between Policy and Commercial Logic
Just because a drug is deemed eligible for coverage by national policies (i.e., innovative and of significant clinical value) does not mean it is economically viable for insurers:
- Eligibility: From a policy perspective, the drug meets the criteria for commercial insurance coverage due to its innovation and clinical importance.
- Affordability: Insurers need to assess the risk: How large is the patient population for this drug? Can the compensation costs be accurately predicted? Will the premium be too high, deterring customers? For instance, drugs for Alzheimer's disease (AD) have a large potential patient base but lack real-world data, making it risky for insurers to offer coverage.
Last year, two AD drugs were included in the commercial insurance catalog but were later transferred back to medical insurance due to affordability issues.
4. The Industry-Specific Catalog: A Solution to "Inflation" and Lack of Standards
Previously, pure commercial health insurance products tried to attract customers by expanding their drug catalogs excessively, sometimes covering drugs as soon as they were released. This led to either unaffordable compensation or situations where drugs were covered but not actually compensated, disappointing both consumers and manufacturers.
The Insurance Association's catalog aims to address this issue by providing a standardized reference for insurers, reducing the need for unnecessary complexity and helping them manage risks more effectively. In the future, it may also share underlying data (e.g., drug compensation rates) to assist in more precise pricing and product design.
5. The Key to Overcoming Barriers: National-Level Coordination
The main challenge is the lack of effective coordination among different departments such as healthcare security, financial regulation, and health authorities. For example, there are issues with the return channels for manufacturers' discounts, and clinical medication policies are not well-aligned, causing hesitation on both sides.
The industry urges the government to establish a clear framework that defines the relationship between the two catalogs and establishes coordination mechanisms, breaking down departmental barriers. Only with national leadership and coordinated efforts can commercial insurance truly become a reliable complement to medical insurance in covering the costs of innovation drugs.
Conclusion
The expansion of commercial insurance innovation drug catalogs and the implementation of industry-specific directories represent important steps towards reducing patients' out-of-pocket expenses for these drugs. However, to fully realize their potential, it is essential to address all the barriers across policy, commercial, and operational aspects. Only with national leadership and coordinated efforts can commercial insurance effectively play its role in supporting innovation drug coverage.