HealthSeptember 12, 2024

Coding alignment to support whole-person health

As drug development becomes more complex, payer organizations need internal operational and coding alignment between medical and drug benefit teams.

Drug development and investments are evolving at an unprecedented rate. In 2023, overall pharmaceutical expenditures in the US grew to $722.5 billion, up 13.6% from the previous year, and specialty drugs are adding new complexities to the industry.

As payer organizations seek to understand and address whole-person health among their members, they may need to adjust operations to meet these new challenges. This is particularly crucial regarding coding operations and alignment between medical and drug benefit teams.

A tale of two health plan benefit teams

Historically, medical and drug benefit teams have operated in silos because the delineations between the two policy teams had more defined spaces. That separation resulted in distinctly different organizational processes, communications, and operations with some inefficiencies and inconsistent decisions—a 2023 study showed that in 14% of instances, medical and pharmacy policies were different for the same drug and could complicate member access to care.

With the recent advent of more specialty drugs and complex medical procedures, lines have blurred between the teams and increased the need for more interoperable processes. In 2023, specialty drugs accounted for less than 5% of claims volume, but accounted for 54% of spending. Complicating this is that 40% of specialty drugs fall under medical benefits, especially portable and self-injectable medications and at-home infusions. Inconsistent decisions around these therapies can become very costly for all involved.

However, separate coding systems for the different medical and pharmacy claims can don’t make it easy. For example, indications from medical coding systems like ICD-10 and HCPCS don’t always neatly map to NDC codes in pharmacy claims. Additionally, pharmacy prescription claims also come in real-time, whereas medical claims are in arrears, leaving pharmacy benefit teams trying to decipher the need for a drug, understand policy implications, and balance quality control.

This leaves benefit teams trying to understand the whole-person but with information coming in various forms and timeframes, and without a full picture of the member.

Challenges with coding data misalignment

Payers are challenged with different coding structures as they create benefit designs in addition to working with different coding processes internally. On the medical benefit side, provider coding can come from different sources—such as HCPCS, ICD-10, CTP, and more—all of which need to be funneled through medical conditions, medical indicator codes, Generic Product Indicators (GPIs), and then aligned into NDC drug codes for the pharmacy benefit teams.

As drugs become more complex, both medical and drug policy teams need clear communication and code mapping to align benefits and coverage. Without this, challenges can include:

  • A lack of visibility into the entire drug spend, because not all drugs are coming through pharmacy benefits
  • Data interoperability challenges limiting awareness into the medical benefits side
  • Improper and/or complex code mapping between drug and medical benefit teams to understand drug indicators
  • Incorrectly entered codes impacting drug coverage or member safety
  • Members becoming frustrated with coverage errors or miscommunication of benefits

Specialty drugs complicate code mapping

As specialty drugs increase in use and for different indicators, drug benefit teams need both coding alignment and the latest evidence to understand how and why drugs are being prescribed. In the case of semaglutide products, the majority are currently used for diabetes management, but Weygovy also received indication approval from the FDA for general weight loss as a diabetic preventative measure. The ICD-10 codes need to seamlessly map to the proper NDC codes for the respective semaglutide product to save drug policy teams the time and effort of understanding which drug product to cover.

In the face of evolving medical evidence, it’s crucial for policy teams to have the correct indication codes and align with the respective approved drug coverage. Having a robust data and analytics strategy is the foundation for improving policy coverage, benefit design, and member experiences.

Benefits of bringing medical and pharmacy data together

When drug and medical benefit teams are aligned with data and proper code mapping, health plans can have more insight into their members’ health and work towards a whole-person approach to wellness. Not every provider will have access to a member’s complete prescription history and polypharmacy—health plan teams need internal alignment founded on evolving evidence to understand indications and ensure safe drug approvals.

Internal operational efficiencies

The foundation for a more robust data strategy is having a clear mapping alignment and data normalization between pharmacy NCD drug codes and provider-based HCPCS and ICD-10 codes. When pharmacy and medical benefit teams have better insight between medical indicators and drug prescriptions, it can improve internal efficiencies, actuarial forecasts, and targeted interventions as well as member safety.

It can also help reduce costly searches for the proper indications for drug prescriptions, reduce human errors, and mitigate member frustrations. The challenge will be getting this mapping right to ensure accuracy so members are receiving the right health information, the right coverage, and the right support. Efforts can start with targeted drugs and populations and expand as the mapping is refined and evidence-based medicine evolves.

Addressing the whole-person for tailored member experiences

As payer organizations seek to improve member experiences, harnessing coding alignment can also support mass personalization of health content and outreach to members. This opportunity requires a solid data foundation strategy to ensure accuracy and tailored experiences, but could potentially have an impact on plan adherence and outcomes. They also have the opportunity to support members with the latest health information based on these indications and prescriptions through engaging care management programs to support plan adherence, create interventions if necessary, and to improve health literacy and outcomes.

Data strategy to work proactively instead of retroactively

With a solid data foundation, internal alignment, and personalized member experiences, health plan companies can work towards a more proactive approach to health. With coding alignment, pharmacy and medical benefit teams can partner with care management programs to help educate members on their health, provide interventions, and support preventative steps. This will require robust analytics and risk-scoring initiatives, but can yield better outcomes in health and operations.

Evidence-based information as the foundation for drug data

For any benefits team trying to support policies and the whole-person member experience, the foundation is evidence-based medicine and the latest clinical and drug information. Even with the best interoperable system, drug benefit teams can perform an extra layer of quality review when prescriptions are entered by cross-referencing the respective indication and clinical recommendations. However, in order for teams to do this safely, a clear data strategy and code mapping must be put in place.

Health plan leaders need a responsible, evidence-based data partner to support mapping strategies, equip teams with the latest evidence, and lay the foundation for a robust drug data strategy that benefits internal teams and the member experience.

Aligning drug and medical benefit teams with evidence-based information and content can help build better internal processes and improve the member experience. Download the whitepaper “Bridging the value gap: Aligning medical and drug benefits for health insurers” to learn more.

Complete the form to download the whitepaper
Allison Combs headshot
Head of Product – Payer Clinical Effectiveness, Wolters Kluwer Health
Allison Combs is currently the Head of Product – Payer Clinical Effectiveness at Wolters Kluwer Health, where she is responsible for growing the payer franchise by increasing current product market fit as well as developing new products.
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