A Conversation With Marci J. Chodroff, M.D.

Marci J. Chodroff, M.D., joined the Managed Healthcare Executive editorial advisory board in February 2024. She is vice president of medical affairs at Magellan Rx, a specialty pharmacy company acquired by Prime Therapeutics in 2022. Chodroff is responsible for utilization management oversight, quality improvement, business development and strategy in program development for Magellan Rx’s specialty pharmacy and oncology programs.

This transcript has been edited for clarity and length.

Marci J. Chodroff, M.D.

You hopped off the clinical track and entered this world of coverage and pharmacy benefits. What drew you to this side of healthcare?

I completed my residency in 1996 and spent 15 years in clinical practice, both as a primary care physician and a hospitalist and made the decision, in 2007, to open up my primary care practice. Although I really loved my position as a primary care physician, I found that the landscape at that time for primary care brought forth many unexpected challenges.

A colleague happened to actually reach out to me about four years into that regarding an administrative role as a physician reviewer at a company called Maximus Federal Services. I decided that with the challenges of being out in practice, it was the right time in my career to start something new. I made the transition to a nonclinical career. I realized that I could impact many more lives in a shorter period of time than I could in clinical practice. I think that was really the motivation for changing to a nonclinical career at that time.

Also, once I got into the role, I learned about Medicare regulations and coverage guidelines, interacted quite a bit with CMS [and learned about] beneficiary rights in the Medicare appeals process. I also had the opportunity to do a little bit of legal work. I testified at administrative law judge hearings. I realized that I was learning a new set of skills that I just loved, and I felt like I was impacting beneficiaries and enrollees nationwide on a larger scale.

You were a physician reviewer. Was that a part-time position with Maximus?

I closed up my practice and went full time as a physician reviewer. At the time, Maximus had several contracts with CMS, of which Medicare Part A was one of them. I was reviewing a lot of cases that had to do with observation versus inpatient. The RAC [Recovery Audit Contractor] had discovered that CMS had overpaid [hospitals] and a lot of the cases should have been billed as observation rather than inpatient. I was in that role with Part A for a little bit over a year and then I moved into a medical director role of the Part D, qualified, independent contractor at Maximus; Maximus actually held that contract since the inception of Medicare Part D in 2006.

Marci J. Chodroff, M.D.

I led a team of four or five physician clinical reviewers who had been there since the inception. They knew Medicare regulations inside and out. They were able to teach me — and I also taught myself — about the Part D Medicare regulations.

I loved it. It was just so interesting. That’s how I really got to know the pharmacy side of the business.

One big issue at the time was we would get a lot of requests for lidocaine patches. As you know, for Medicare Part D, a drug is covered only if it has the right medically accepted indication. Many prescribers were requesting lidocaine patches for a variety of other indications outside of the three to four medically accepted indications that CMS allowed at the time. So there were a lot of appeals.

At that time there also were a lot of requests for hepatitis C drugs. That was very big during my medical directorship.

After working as a reviewer, the next step in your career was working for Magellan. Specialty drugs took off.

Specialty growth is outpacing traditional growth at more than 50% share of total pharmacy spend, and the total spend in 2022 was $605 billion. So that’s a lot of spend, right? Prime and Magellan Rx [Prime M Rx] have been leaders in managing specialty pharmacy spend on the medical benefit with solutions such as prior authorization, post-service claim edits, dose optimization, site of service and drug wastage. I’ve been involved in those programs as a medical director, vice president of medical affairs and physician reviewer, and my team has been as well.

We’ve seen exponential growth in specialty pharmacy, particularly in oncology, neurology, gastroenterology and rheumatology, to name a few, which has required our organization to ensure that we have access to specialist physician reviewers who are familiar with these new drugs and are qualified to perform evidence-based reviews for prior authorization. So I would say that is what I’ve noticed the most in terms of how it’s affected the work that I’ve done at Magellan Rx and Prime.

Do you think there’s a problem with too many drugs being classified as specialty drugs? The boundary seems fuzzy. It seems it depends on who is doing the classifying whether a drug is classified as a specialty drug.

What you’re saying could be correct. I think you’re right; it depends on who’s defining specialty drugs. Regardless of classification, our members with complicated high-cost conditions are very much impacted. Nearly one-third of our members are covered under a specialty solution. So that’s 33 million of 92 million members total.

Prime M Rx defines specialty medications as high-cost oral or injectable medications that are used to treat complex chronic conditions. The drugs must have at least one of several characteristics to be classified as a specialty medication. The first is that the drug is high cost, meaning it is priced at more than $1,000 per 30-day supply, and [these drugs] may include self-administered injectables, professionally administered injectables and infusions.

Secondly, they could be high complexity. Those are biology-based medications that structurally mimic compounds that are found within the body. They could be orphan or ultra-orphan drugs.

The third characteristic would be they are a high-touch medication — the medication requires temperature control or other shipping or handling requirements. The drug may need special management by a pharmacist or physician who specializes in the use of the drug, or the drug may require ongoing member education to discuss side effects and ensure adherence.

Are any particular classes or diseases or specialty drug technologies presenting new challenges or problems?

Cell and gene therapies and the sickle-cell gene therapies [approved in late 2023] — those are things that our organization is definitely focusing on. The combined price tag and prevalence of these conditions really has the potential to dramatically impact the specialty pharmacy spend and trends for plans. Several healthcare policy watchers are proposing a
Part E national benefit for certain cell and gene therapies, which I found very interesting. This Part E national benefit would allow Americans to receive equitable access to new treatments and may assist in decreasing the cost of the drug. And it may be for everybody, not just Medicare beneficiaries.

Oncology is another area that we’ve been focusing on. I can just give you a couple of examples. Keytruda [pembrolizumab] has an expanded indication to include triple-negative breast cancer, and advanced endometrial carcinoma has been a main driver of spend increase. It’s kept it as a top driver across all lines of business with an increase in PMPM [per member, per month] spend of 57.5% commercial, 12.5% Medicare and 19.1% Medicaid from the previous year. Neulasta [pegfilgrastim] continues to remain a top-used drug within the oncology support agents and long-acting colony-stimulating factors. Despite utilization trends dropping by as much as 10%, Neulasta is still capturing 65% of market share across all lines of business.

The other thing that I want to mention is the GLP-1s [glucagon-like peptide 1 agonists]. We’ve been focusing on those over the past year and will continue to with obesity being such a highly prevalent condition with risk for so many other conditions. The utilization of GLP-1s has really substantially impacted costs for payers and patients.

Finally, I want to mention, because it impacts the work my team is doing, the regulatory changes to utilization management that we’ve noticed over the past couple of years and going into 2024 as well. Depending on the state, the impacted elements may include prior authorization turnaround times. Step therapy guidelines can vary from one state to another and also the types of credentialing of physician reviewers when they’re reviewing prior authorization. Certain states may want to make sure that the reviewer is of the same or similar specialty match and/or the same or similar license match where the patient is receiving the care.

You’re a Magellan Rx employee, and Prime Therapeutics purchased Magellan last year. Did the acquisition change your title or your responsibilities?

It hasn’t changed my title. I have a really strong team, with a medical director and physician clinical reviewers in a variety of specialties who are bringing their expertise to Prime and Magellan Rx. I’ve also had the opportunity to bring my Medicare expertise to the 1.8 million Medicare members that Prime brings to our combined organization and to work with new colleagues who have years of Medicare experience. We’re collaborating as one team and learning from each other quite a bit.

The other thing that I’ve really enjoyed having the opportunity to work on in the past year has been health equity in our combined new organization. I’ve also had the opportunity to serve as a member of Prime’s diversity and inclusion [D&I] council. I don’t know if you heard this, but Prime’s D&I efforts were mentioned in Newsweek magazine. That was something that we’re very, very proud of as well.

Pharmacy benefit managers [PBMs] have come under a lot of scrutiny. When you heard that a PBM was going to buy Magellan, did you have some misgivings?

No, I don’t think so. Prime M Rx has a lot of advantages and value that it brings to health plan clients, employer groups and consumers. The first — and I think the most differentiating — is that we are not a publicly traded company. We’re privately owned by 19 not-for-profit Blues plans, who are also our clients. We have a mutual interest in providing the same care that we would want for our loved ones. We want to make sure that members get the right drug at the right time in a safe manner. We have a lot of access to data on medical and pharmacy benefits, which helps us to understand the whole patient and improve the overall outcomes of our clients’ members.

There is some concern out there about PBMs owning specialty pharmacies —that it can lead to vertical concentration. What would you say to people who are concerned that the drug supply chain is getting increasingly controlled by just a few entities?

Prime M RX is not incentivized to promote pharmacies we own. We work with our customers to help them choose the best and most affordable paths for their business and their members. An example of this is Integrated Rx. Integrated Rx is when members can fill certain disease-specific prescriptions, mostly in oncology right now, from an in-house pharmacy or from their doctor’s office. This helps the provider and the pharmacist communicate directly, creating a more cohesive care team and ultimately providing a better member and provider experience. We found that the program has a 95% satisfaction rate rating from its participants.

Prime has had somevalue-based contracts involving prescription digital therapeutics. What do you think about the future of digital therapeutics?

Prime M Rx does have some digital therapies in our formulary, so we greatly understand the value that digital apps bring to consumers. Prime M Rx takes a consumer-centric approach, and we work with the members to meet them where they are and how they want their care delivered. For example, we have a real-time benefit check product where members can see personalized benefit information that helps them understand the cost of their prescriptions, according to their plan, in real time. All alternate drug and pharmacy network suggestions are based on the members’ benefit plan, their formulary, the network and the accumulator balance. On the horizon are AI [artificial intelligence] and other digital tools, which we know will have an increased demand in the healthcare sector.

What are you looking forward to — or dreading — in 2024?

Because of my Medicare background and the integration of our organizations, I now have the opportunity to serve 1.8 million new [Medicare] beneficiaries. I’m very passionate about Medicare and want to ensure that all Medicare beneficiaries, both our nation’s seniors and patients with special health needs, have a seamless experience accessing high-quality, safe and equitable healthcare. I want to work very hard to make sure that that is happening for our health plan clients’ members going into 2024 and beyond.