USE OF PRIOR AUTHORIZATION, STEP THERAPY, AND QUANTITY LIMITSIN THE UNITED STATES: A NATIONAL PHARMACY CLAIMS ANALYSIS
Author(s)
Rupshikha Sen, MHS, DDS, Hemalkumar Mehta, MS, PhD, Jeromie Ballreich, MS, PhD, Emaan Rashidi, MHS, Gerard Anderson, PhD, Joseph F. Levy, PhD, Calab Alexander, MS, MD;
Bloomberg School of Public Health, Johns Hopkins University, Baltimore, MD, USA
Bloomberg School of Public Health, Johns Hopkins University, Baltimore, MD, USA
OBJECTIVES: Drug utilization management (DUM) tools, including prior authorization (PA), step therapy (ST), and quantity limits (QL), are used in U.S. pharmacy benefits. However, evidence describing how these strategies are applied across payer types and therapeutic classes, and how often they result in claim rejection, remains limited. Our objective is to characterize the prevalence of PA, ST, and QL across therapeutic classes and insurance types and to quantify pharmacy claim rejections attributable to these policies.
METHODS: We conducted a retrospective cross-sectional analysis of adjudicated outpatient pharmacy transactions from 2024 using IQVIA’s Formulary Impact Analyzer. The study included a 10% longitudinal sample of 4.1 million individuals, accounting for 178.5 million prescription transactions. Our outcomes were (1) Exposure to DUM, defined as transactions occurring in plan-drug combinations where at least 5% of rejected claims were attributed to PA, ST, or QL; and (2) claim rejections attributable to DUM rejection codes.
RESULTS: Based on preliminary analyses, of 178.5 million transactions, 47.7 million (26.7%) were exposed to DUM and 13.1 million (7.4%) were rejected due to PA, ST, or QL. Exposure was most common among Medicaid (46.8%) and commercial plans (32.4%) compared with Medicare (15.6%). DUM prevalence varied by therapeutic class, with the highest exposure among mental health (51.4%) and endocrinology (41.7%) therapies and the lowest among cardiovascular (25.5%) and infectious disease (18.2%) treatments. Step therapy was the most applied strategy. For example, 86.6% of hydrocodone-acetaminophen claims were subject to step therapy. Prior authorization rates were generally low, less than 1.5%, but substantially higher for GLP-1 agonists and selected analgesics. Several high-volume products, including semaglutide, tramadol, and hydrocodone-acetaminophen, were universally subject to drug utilization management.
CONCLUSIONS: Among this cohort, drug utilization management was commonly applied and varied substantially across therapeutic areas and payors, suggesting a complex administrative and clinical landscape that is inconsistent for patients and providers alike.
METHODS: We conducted a retrospective cross-sectional analysis of adjudicated outpatient pharmacy transactions from 2024 using IQVIA’s Formulary Impact Analyzer. The study included a 10% longitudinal sample of 4.1 million individuals, accounting for 178.5 million prescription transactions. Our outcomes were (1) Exposure to DUM, defined as transactions occurring in plan-drug combinations where at least 5% of rejected claims were attributed to PA, ST, or QL; and (2) claim rejections attributable to DUM rejection codes.
RESULTS: Based on preliminary analyses, of 178.5 million transactions, 47.7 million (26.7%) were exposed to DUM and 13.1 million (7.4%) were rejected due to PA, ST, or QL. Exposure was most common among Medicaid (46.8%) and commercial plans (32.4%) compared with Medicare (15.6%). DUM prevalence varied by therapeutic class, with the highest exposure among mental health (51.4%) and endocrinology (41.7%) therapies and the lowest among cardiovascular (25.5%) and infectious disease (18.2%) treatments. Step therapy was the most applied strategy. For example, 86.6% of hydrocodone-acetaminophen claims were subject to step therapy. Prior authorization rates were generally low, less than 1.5%, but substantially higher for GLP-1 agonists and selected analgesics. Several high-volume products, including semaglutide, tramadol, and hydrocodone-acetaminophen, were universally subject to drug utilization management.
CONCLUSIONS: Among this cohort, drug utilization management was commonly applied and varied substantially across therapeutic areas and payors, suggesting a complex administrative and clinical landscape that is inconsistent for patients and providers alike.
Conference/Value in Health Info
2026-05, ISPOR 2026, Philadelphia, PA, USA
Value in Health, Volume 29, Issue S6
Code
HPR77
Topic
Health Policy & Regulatory
Topic Subcategory
Insurance Systems & National Health Care, Pricing Policy & Schemes, Public Spending & National Health Expenditures, Reimbursement & Access Policy
Disease
SDC: Cardiovascular Disorders (including MI, Stroke, Circulatory), SDC: Diabetes/Endocrine/Metabolic Disorders (including obesity), SDC: Infectious Disease (non-vaccine), STA: Multiple/Other Specialized Treatments