Companies Look to Pharmacy Benefits for Savings

Employers increasingly are putting prescription drugs — specifically their plan designs and providers — under the microscope in hopes of spotting more health care savings.

Following a trend among health care plans, more prescription drug plans are shifting to a “value-based” model, according to Lauren Flynn Kelly, a blogger with AIS Health. In a recent post, Kelly highlighted one particular eight-tier formula that assigned clinical and financial values to drugs on each tier and included only a few lower-cost generics on its first tier.

Ritu Malhotra of The Segal Co. noted that this type of plan design promotes the use of generics — particularly the lower-cost generic options.

“I think the value part of the value-based plan design is that those drugs are effective and much more cost-effective and could potentially result in a savings on the medical side if patients are more adherent,” Malhotra notes in the AIS Health post.

Patient adherence is a primary goal of value-based plans, Kelly wrote. Unfortunately for employers, it’s an area where the statistics remain grim. A recent poll by Express Scripts Inc. found that non-adherence cost the nation about $317.4 billion in 2011 in treatment — that’s not counting lost productivity and other costs that can occur when patients don’t follow their prescribed drug regimen, according to a report in Employee Benefit News.

While adherence remains a constant obstacle, recent moves in the pharmacy benefit marketplace may create alternative opportunities for lower costs and stronger benefits, an online Workforce report suggests.

Express Scripts’ $29 billion purchase of Medco Health Solutions could shake up the pharmacy benefit management (PBM) landscape, potentially creating a polarization between big PBMs that offer the best costs and smaller PBMs that can offer more services, F. Randy Vogenberg of the Institute for Integrated Healthcare told Workforce.

Linda Cahn, founder of Pharmacy Benefits Consultants, suggests that the merger may prompt some employers to start shopping for better deals.

“I think people are aware that changing PBMs can save them large amounts of money, and they are also aware that marketplace developments create further incentives to conduct [request for proposals],” Cahn told Workforce.

Most employers, however, likely won’t make any sudden moves with their PBMs at renewal time later this year.

“Change creates controversy, and employers are not looking for controversy,” Vogenberg said.


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