5 Factors that Could Potentially Affect Medical Costs for 2017


Pharmacy benefit managers may play a significant role in reducing medical costs.

A recent report from PwC's Health Research Institute (HIR) projected that medical costs for 2017 will hold steady at the 6.5% increase seen in the 2016 rate. However, a flat trend is not a positive, since decreasing costs and improving care is a major goal for all healthcare organizations.

HRI believes the following factors will influence medical trend costs for 2017:

Increases Costs

1. Convenience

Facilities such as retail clinics and urgent care centers are easy and convenient ways for patients of all ages to seek care. Some patients who would have otherwise gone without medical attention are now seeking care, which could lead to higher costs in the short-term even if they reduce costs on a long-term scale, according to HRI.

2. Access to Behavioral Health

In the past, patients had a strenuous time accessing mental health services and having those treatments covered by insurance. Only recently has a new effort been launched to ensure patient options are affordable and not limited. HRI reported this long-awaited change will inflate medical costs short-term, although it could potentially reduce long-term costs.


1. Specialty Drug Costs

The cost of specialty drugs is not projected to grow as rapidly as it has in the past, especially compared with the high costs of hepatitis C drugs.

Decreases costs

1. High Performance Networks

Since these networks provide more limited choices when it comes to providers and could offer outcomes-based treatments, they are able to reduce costs up to 35%, according to HRI. High-performance networks are also monitored by state insurance and health laws to avoid becoming too restrictive for patients.

2. Pharmacy Benefit Managers

Pharmacy benefit managers (PBMs) are said to be aggressive in the way they negotiate drug costs through limited drug formularies. PBMs are able to provide patients and payers with lower drug costs that results in lower drug spending overall, according to HRI.

"This report underscores how PBMs are driving competition and in turn reducing costs for consumers, employers, government programs, and unions,” Mark Merritt, president and CEO of the Pharmaceutical Care Management Association, said in a press release. “Policymakers should embrace greater use of proven PBM tools and reject drugmaker and drugstore lobby mandates that would increase prescription drug costs."

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