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As science makes once-unthinkable treatments available, patients are increasingly facing a harsh reality: Insurance companies are forcing them to try older, less expensive therapies for months before covering pricier ones.

Insurers have long relied on a cautious approach to control costs and spare patients from expensive medications they might not need. But in more than a dozen interviews with doctors and patients, a picture has emerged of insurers growing more aggressive as they respond to financial pressures.

The result is a reliance on what is known as “step therapy,” whereby patients are forced to try cheaper treatments before they graduate to more expensive ones, even when health care providers are confident the inexpensive treatments will not work.


In one example, a woman with lupus said her vision was severely affected after an insurer forced her to try multiple medications before paying for one that her doctor initially wanted to prescribe. In another, a patient with lung cancer took a break from a successful chemotherapy regimen, then was blocked by her insurer from resuming it until she had tried other drugs.

Spurred by stories like these, state legislators, who regulate Medicaid plans and much of the nation’s private insurance, have begun pushing back. In recent months, at least five states, including California and Indiana, have passed legislation to rein in step therapy approaches, known by critics as “fail first” policies. More than a dozen other states now have such laws on the books.


Insurers argue that, beyond individual patient cases, step therapy has improved their ability to cover a wide range of patients and medications.

“Step therapy is addressing the problem of making sure patients get the right treatment at the right time, and if there’s an affordable alternative, they have access to it first,” said Clare Krusing, a spokeswoman for America’s Health Insurance Plans, a trade group.

Doctors and ethicists generally do not dispute that theory. Dr. Steven D. Pearson, founder of the Institute for Clinical and Economic Review, a health care industry think tank, said that in situations in which two treatments would likely offer equal benefits, “most people would say it’s reasonable to try the less expensive one first.”

But “the important nuance comes when there might be specific reasons where a patient or doctor feels like the more expensive drug would work better,” he said. “So it all depends on what the harm would be if they tried the less expensive one first.”

The rise in step therapy policies is being driven by a host of factors, including rising drug costs. Employer-sponsored health plans are growing more restrictive with coverage, analysts said, as businesses seek to control healthcare spending. Participants in Affordable Care Act health care exchanges have also been affected: Many patients have switched carriers, either by choice or because insurers have exited the exchanges. When they do, patients are often told to restart step therapy protocols anew.

“The patient’s being told to use a drug we know isn’t going to work, but we have to use it anyway for someone with terminal illness? To me that’s just insane.”

Dr. Kenneth B. Blankstein, oncologist

Take Karin Keyes, a 45-year-old psychotherapist on Long Island. Keyes was diagnosed with rheumatoid arthritis roughly eight years ago while enduring excruciating pain.

Her doctor prescribed Orencia, one of an expensive new generation of so-called “biologic” anti-inflammatory drugs that can cost as much as $50,000 annually.

Keyes’s insurer at the time said it would not cover Orencia unless she tried methotrexate, a far less expensive treatment. Methotrexate helped slightly, but Keyes was still in pain and had limited movement. Still, because she technically responded to the drug, she didn’t qualify for Orencia.

When she changed to a new insurer, her doctor prescribed Orencia again, this time with success. “My pain went to zero,” Keyes said. “I started hiking, living a normal life.”

It was not a permanent solution. When that insurer filed for bankruptcy protection earlier this year, Keyes’s new insurer said it would not cover Orencia unless she failed on methotrexate again.

“They had all the documentation. They’d seen that I’d not done as well on methotrexate,” she said. “They still denied it.”

Karin Keyes
Keyes, a 45-year-old psychotherapist, holds a dose of her anti-arthritis medication. Alice Proujansky for STAT

Doctors and patient advocacy groups said insurance companies often insist on step therapy regardless of past medication failures. For some patients, though, one trip through the process can bring significant risks and strain.

Kathleen Arntsen, of Verona, N.Y., said her ophthalmologist prescribed Travatan Z eye drops in 2014 to treat glaucoma because he feared that other medications might trigger side effects and because her eye responded well to samples of the medication.

Arnsten’s insurer said she would have to try two cheaper drugs first. Over the course of seven weeks, those medications led to “massive” swelling and pressure, she said.

At the end of the span, the insurer approved Travatan Z, but her vision continued to deteriorate. She is blind in that eye, and is considering having the eye removed because of persistent pain.

Arntsen, who has advocated for step-therapy regulations in New York, said she and her doctor cannot say for sure whether the delay caused her vision loss, but she believes it was a contributing factor.

“I’m an educated advocate, and my doctor didn’t give up on this, yet I was forced to fail a treatment he predicted I’d fail on,” she said.

Pearson, of ICER, said there’s no effective way of determining how well or poorly insurers are handling step-therapy disputes with doctors and patients. In a 2014 Health Affairs report he coauthored Rahul Nayak, Pearson set forth some ethical guidelines for fairly applying step therapy.

Chief among them: clearly define failure; don’t cause long-term harm; rapidly review relevant new evidence in developing step-therapy guidelines; and give doctors quick and easy ways to appeal an insurer’s decision.

J. Russell Teagarden, a health care industry consultant with experience in setting drug coverage policies for health insurance plans, said the last recommendation in particular is “very difficult” to follow because the complexity of many cases means it takes time and medical specialists to resolve them.

Teagarden, a former executive at the pharmacy benefits management company Medco Health Solutions, which was acquired by Express Scripts in 2012, said that step-therapy policies and decisions “would keep us up at night. It’s a big job to stay on top of. It requires people and a lot of money and not every company can do it. It’s a real issue.”

Some insurers, he said, “play games with these things, and put them in place simply because it’s a barrier. They’re looking for attrition. No one will admit it, but that’s the case. And shame on them.”

Patients’ frustration is shared by doctors, who have grown accustomed to — but no less frustrated by — the insurance industry’s efforts to contain costs. Sometimes the insurer’s step-therapy decisions perplex doctors.

Dr. Kenneth B. Blankstein, an oncologist in Flemington, N.J., is treating a woman for lung cancer. She responded well to the first chemotherapy drugs he prescribed. When her health was stable, he gave her a “temporary break” from chemo to spare her some of its side effects.

But when he tried to return her to the treatment, the insurer balked, saying that the “temporary break” was evidence that the treatment had failed. Despite Blankstein’s protests, the insurer said she would have to move next to Tarceva, another treatment.

“She had under a 5 percent chance of a response on Tarceva,” he said. “Yet they insisted, so we had to.”

As Blankstein expected, the patient did not respond, but instead of letting her return to the first chemo cocktail, the insurer insisted she try another drug first.

The patient ultimately switched to Medicare, which covered the first chemotherapy protocol. Her health is stable.

“The patient’s being told to use a drug we know isn’t going to work, but we have to use it anyway for someone with terminal illness? To me that’s just insane, but it’s the way they do things,” Blankstein said. “It’s taken away clinical judgment. It’s managing by algorithms.”

State laws restricting the practice of step therapy vary widely.

According to the National Patient Advocate Foundation, a nonprofit group, Indiana’s law is the most aggressive. Among other things, it bars insurers from restarting the step-therapy sequence if they had already failed certain treatments with a previous insurer, and insurers must adjudicate appeals within three days.

Advocates said that patients in other states will do well to review the step-therapy policies of prospective insurers before signing up. Larger insurers will often post lists of drugs that are subject to step-therapy restrictions, but sometimes even those restrictions can vary based on a particular employer’s health plan, for instance.

“Step therapy can have a place in a reasonable plan design,” said Alan Balch, chief executive of the National Patient Advocate Foundation. But that plan should be transparent to patients and allow for appeals, he said. “There is no humane reason to deny a patient access to a therapy that has the best chance of curing them.”

  • The article is of interest, but it does fail to explain some things. First, many of these step therapies are intended to direct patients to proven therapies that come at a significant cost savings (for both the patient and the payer). Lets take diabetes for instance. With the many options for diabetes patients may come into a visit with their clinician requesting a newer agent they saw advertised. This patient may have great intentions and have done some research, but their request may not be ideal for their situation. However, research has shown that clinicians are much more likely to write a prescription for the requested drug. If you look at the clinical evidence, the best drug that continues to be available to treat diabetes is metformin, available at a considerable price discount and placed at the lowest tier of the patients formulary. By putting a step therapy in place to have patients trial metformin before starting a non-preferred product, you save the patient money, save the system money, and likely improve outcomes. Remove the step therapy, the patient gets their drug for $50 or $100 a month compared to the $10 or less they may pay for metformin, the payer pays 20 times what they would pay for metformin, and the patient is getting worse care. This is one of many examples I could provide, which can include biologics. When there is better clinical evidence and a potential cost saving AND prescribing decisions can be influence by patient request it seems to me there remains a place for such programs. As with all programs, they do need to be implemented appropriately in order to get the outcome of desire.

  • This is fun with psychiatric medications, too. They differ significantly, take a long time to have an effect, can have awful side effects and discontinuation symptoms that go on for months, but insurers want you to try all of them.

  • Only in America. Since when a clerk, or an accountant, or a lawyer become a health care specialist? To the point or stupidity, to challenge an expert physician opinion?? Look at this seriously: The so called “health insurance industry” is a- not healthy, is criminally dangerous. b- Is not insurance. It is a racket intent to profit no matter what, specially when medical ignorance openly trumps sound scientific medical expertise. c- It is not an industry. It is really an artificial hindrance/barrier/obstacle between patients and doctors. And, it only makes way too many mistakes with deleterious consequences for sick humans. This has to stop. Now.
    The proper algorithm should be: Patient + Physician+Hospital+ Pharmacy, Laboratory= Health Care.” Insurance Companies” are meddlers, profiteers and
    have no practical role in disease cure/management. Period.

  • There are many parts of this article that I have to disagree with. First, step therapy can be an effective hedge against Direct to Consumer advertising by pharmaceutical companies as patient’s go to physicians asking for the latest and “greatest” drug when that may not be necessary.

    Second, physicians rarely have financial incentives to be mindful of the cost/benefit aspect of a script they write, so some form of management control is necessary.

    Because, third, we spend a lot on health care in the US, and Rx trend at 11.5% is unsustainable. As the decision maker for a large, self-insured health plan that will spend almost $20 million on drugs alone this year, I must ensure we are doing everything possible to manage the plan.

    Fourth, step therapy has existed for well over 20 years, yet the author acts like this is something new.

    Finally, I hate the personal anecdotal stories to support the writer’s starting hypothesis. I saw this in the 90’s and it killed some of the effective managed care processes in place at the time. How about the thousands who are on a less expensive generic that is effective for them?

    There are finite resources available for a large number of people, and we need to be mindful of doing good things for the majority within those constraints.

    • @Scott. Your argument may kind of hold up for small molecule drugs but it falls apart with biologics. Methotrexate — a drug that has a significant side effect profile, has negligible efficacy for many chronic inflammatory diseases and is contraindicated for women of child-bearing age, should not be the default step to a biologic. Why is that? “OH IT’S CHEAP,” say the insurance companies. “And biologics are so expensive!” So in the name of short-term profits over patient health, we’ll make everyone go through this step.

      What doesn’t get factored into the balance sheet is the downstream utilization of health care services when you have a whole population of people with poorly controlled inflammatory diseases and their associated comorbid conditions.

      Insurance companies should be not-for-profit. Then the dollars spent returning shareholder value and focusing on profit can return to the task at hand: providing coverage when your patient-customers need it.

      And why should docs know the price of every drug they prescribe? They are doctors, not economists.

    • This article unfortunately heads down the path of instilling “fear” and contempt for a program that can have positive clinical and economic benefit. If we remove all barriers to inappropriate prescribing and use, we will end up back where we were before managed care showed up. Poor outcomes, cost growing even more rapidly, and pharmaceutical manufacturers ramping up advertising to patients and prescribers to drive utilization.

  • This is what happens when we allow non-expert people to make medical decisions outside of the doctor patient relationship. For over 3 decades I would create a treatment plan to tackle a patient’s cancer and the Insurance Company would simply ask me to justify it. Now they swap the process. They tell me the treatment plan and I either accept it or they won’t pay. Why bother having doctors in the loop at all? Why not simply go tot he Insurance Company store with a diagnosis created by the doctor and let them take care of all the therapy?
    The newest game to support the comments and the article is “provider specific approval” game. If I create a plan and it gets approved and the patient goes to see one of my partners to have it implemented (we are a group so it routinely happens) that provider needs to redo the entire approval process all over again. In my own case (both a surgeon as well as cancer patient) I was approved for a course of chemo with my partner. We started it over a year ago, everything working fine. Unfortunately he passed away in October and when I tried to order another round of meds the insurance had to have an entire new preauthorization done for the new replacement to my partner. This is PURELY a game to see who will break first. If they create enough grief they hope the patient or the provider will simply either give up or the patient will pass away and they are off the hook.
    Dr D

  • State legislation stopping insurance abuses will soon not be possible. Our Republican Congressional friends, fully bought and paid for by the billionaire bullies, are pushing to limit State’s Rights to control insurance company abuse by making FEDERAL laws written by insurance companies to supercede the state laws.

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