Reference Pricing: Pharmacy Invoice Cost (ACTUAL) for Top Selling Generic and Brand Prescription Drugs
Why is this document important? Healthcare marketers are aggressively pursuing new revenue streams to augment lower reimbursements provided under PPACA. Prescription drugs, particularly specialty, are key drivers in the growth strategies of PBMs, TPAs and MCOs pursuant to healthcare reform.
The costs shared below are what our pharmacy actually pays; not AWP, MAC or WAC. The bottom line; payers must have access to “reference pricing.” Apply this knowledge to hold PBMs accountable and lower plan expenditures for stakeholders.
_1.jpg)
When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.
The costs shared below are what our pharmacy actually pays; not AWP, MAC or WAC. The bottom line; payers must have access to “reference pricing.” Apply this knowledge to hold PBMs accountable and lower plan expenditures for stakeholders.
_1.jpg){kind=spacer}
| How to Determine if Your Company [or Client] is Overpaying |
Step #1: Obtain a price list for generic prescription drugs from your broker, TPA, ASO or PBM every month.
Step #2: In addition, request an electronic copy of all your prescription transactions (claims) for the billing cycle which coincides with the date of your price list.
Step #3: Compare approximately 10 to 20 prescription claims against the price list to confirm contract agreement. It’s impractical to verify all claims, but 10 is a sample size large enough to extract some good assumptions.
Step #4: Now take it one step further. Check what your organization has paid, for prescription drugs, against our pharmacy cost then determine if a problem exists. When there is a 5% or more price differential (paid versus actual cost) we consider this a problem.
Multiple price differential discoveries means that your organization or client is likely overpaying. REPEAT these steps once per month.
— Tip —
Always include a semi-annual market check in your PBM contract language. Market checks provide each payer the ability, during the contract, to determine if better pricing is available in the marketplace compared to what the client is currently receiving.
When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.
Plan Sponsors’ Satisfaction With PBMs Remains Relatively Unchanged
The Pharmacy Benefit Management Institute (PBMI) released its 2014 PBM Customer Satisfaction Report based on its annual survey of drug benefit plan sponsors. The report shows a mean overall satisfaction score of 7.5 on a 10-point scale, a result that has remained relatively unchanged for the past five years. The 2014 survey was completed by 394 U.S. plan sponsors representing more than 64.7 million enrollees.
PBMs are rated not only on their overall performance, but also on specific functions and services, including those related to specialty (“biotech”) drugs. The survey is regularly updated to reflect market trends. This year’s survey included two new service dimension ratings: commitment to good customer service and meeting financial guarantees.
The following highlights key findings from the report:
- Comparing plan sponsor types (health plans, employers, and unions), little variation is found in overall satisfaction or satisfaction with specific service dimensions, PBM functions, or non-core services.
- The percentage of respondents indicating that their financial relationship with their PBM is completely transparent grew significantly this year, up to 44% versus 35% in 2013.
Read more: http://www.digitaljournal.com/pr/1848618#ixzz31bU0BKR7
Reference Pricing: Pharmacy Invoice Cost (ACTUAL) for Top Selling Generic and Brand Prescription Drugs
Why is this document important? Healthcare marketers are aggressively pursuing new revenue streams to augment lower reimbursements provided under PPACA. Prescription drugs, particularly specialty, are key drivers in the growth strategies of PBMs, TPAs and MCOs pursuant to healthcare reform.
The costs shared below are what our pharmacy actually pays; not AWP, MAC or WAC. The bottom line; payers must have access to “reference pricing.” Apply this knowledge to hold PBMs accountable and lower plan expenditures for stakeholders.
_1.jpg)
When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.
The costs shared below are what our pharmacy actually pays; not AWP, MAC or WAC. The bottom line; payers must have access to “reference pricing.” Apply this knowledge to hold PBMs accountable and lower plan expenditures for stakeholders.
_1.jpg){kind=spacer}
| How to Determine if Your Company [or Client] is Overpaying |
Step #1: Obtain a price list for generic prescription drugs from your broker, TPA, ASO or PBM every month.
Step #2: In addition, request an electronic copy of all your prescription transactions (claims) for the billing cycle which coincides with the date of your price list.
Step #3: Compare approximately 10 to 20 prescription claims against the price list to confirm contract agreement. It’s impractical to verify all claims, but 10 is a sample size large enough to extract some good assumptions.
Step #4: Now take it one step further. Check what your organization has paid, for prescription drugs, against our pharmacy cost then determine if a problem exists. When there is a 5% or more price differential (paid versus actual cost) we consider this a problem.
Multiple price differential discoveries means that your organization or client is likely overpaying. REPEAT these steps once per month.
— Tip —
Always include a semi-annual market check in your PBM contract language. Market checks provide each payer the ability, during the contract, to determine if better pricing is available in the marketplace compared to what the client is currently receiving.
When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.
IMS Report: Specialty Medications Drive Prescription Drug Spending Increase
Spending on specialty medications continues to grow, and the gap between the cost of treating medical conditions with generic drugs and the cost of treating more serious illnesses with specialty drugs continues to widen, according to a report released on April 15, 2014, by the IMS Institute for Healthcare Informatics. The report finds that total spending on prescription medications rose by 3.2% to $329.2 billion in 2013.
The increase was attributed to a variety of factors, including higher costs for new specialty drugs, as use of health care services by consumers went up for the first time in 3 years. “Following several years of decline, 2013 was striking for the increased use by patients of all parts of the U.S. health care system—even in advance of full implementation of the Affordable Care Act,” said Murray Aitken, executive director of the IMS Institute for Healthcare Informatics, in a press release.
“Growth in medicine spending remains at historically low levels despite a significant uptick last year, and continues to contribute to the bending of the health care cost curve.” Patients with rare or serious conditions were found to bear a much larger burden from out-of-pocket costs than did patients who do not need specialty drugs.
The report states that 30% of consumer drug spending last year came from just 2.3% of prescriptions, which had co-pays of more than $70 and which were frequently specialty medications. (Consumers paid an average of $145 in out-of-pocket expenses for these medications.)
Reference Pricing: Pharmacy Invoice Cost (ACTUAL) for Top Selling Generic and Brand Prescription Drugs
Why is this document important? Healthcare marketers are aggressively pursuing new revenue streams to augment lower reimbursements provided under PPACA. Prescription drugs, particularly specialty, are key drivers in the growth strategies of PBMs, TPAs and MCOs pursuant to healthcare reform.
The costs shared below are what our pharmacy actually pays; not AWP, MAC or WAC. The bottom line; payers must have access to “reference pricing.” Apply this knowledge to hold PBMs accountable and lower plan expenditures for stakeholders._1.jpg)
When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.
The costs shared below are what our pharmacy actually pays; not AWP, MAC or WAC. The bottom line; payers must have access to “reference pricing.” Apply this knowledge to hold PBMs accountable and lower plan expenditures for stakeholders.
_1.jpg){kind=spacer}
| How to Determine if Your Company [or Client] is Overpaying |
Step #1: Obtain a price list for generic prescription drugs from your broker, TPA, ASO or PBM every month.
Step #2: In addition, request an electronic copy of all your prescription transactions (claims) for the billing cycle which coincides with the date of your price list.
Step #3: Compare approximately 10 to 20 prescription claims against the price list to confirm contract agreement. It’s impractical to verify all claims, but 10 is a sample size large enough to extract some good assumptions.
Step #4: Now take it one step further. Check what your organization has paid, for prescription drugs, against our pharmacy cost then determine if a problem exists. When there is a 5% or more price differential (paid versus actual cost) we consider this a problem.
Multiple price differential discoveries means that your organization or client is likely overpaying. REPEAT these steps once per month.
— Tip —
Always include a semi-annual market check in your PBM contract language. Market checks provide each payer the ability, during the contract, to determine if better pricing is available in the marketplace compared to what the client is currently receiving.
When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.
Early Pharmacy Claims Data from Exchange Enrollees Indicate High Usage
When setting rates for qualified health plans sold through public exchanges a year ago, actuaries anticipated that people who purchased coverage through an exchange would be older and less healthy than the commercially insured population. They also assumed there would be pent-up demand for pharmaceuticals and care.
Now that exchanges are up and running, preliminary drug claims data is showing such a trend. The April 17 issue of Atlantic Information Services, Inc.’s Inside Health Insurance Exchanges (HEX) walks readers through data from two pharmacy benefit managers (PBMs) and what it means for insurers.
During the first two months of 2014, exchange enrollees were more likely to use costly specialty drugs when compared to those with coverage outside of the exchanges, according to preliminary claims data released April 9 by Express Scripts.
According to the early data, six of the 10 costliest medications used by exchange enrollees were specialty drugs versus four of the top 10 used by commercial health plan enrollees. Of total prescriptions filled for exchange plans, 1.1% was for specialty drugs, compared with 0.75% in commercial plans — a near-50% difference.
Read more: http://www.digitaljournal.com/pr/1867253#ixzz2zipbRF40
Now that exchanges are up and running, preliminary drug claims data is showing such a trend. The April 17 issue of Atlantic Information Services, Inc.’s Inside Health Insurance Exchanges (HEX) walks readers through data from two pharmacy benefit managers (PBMs) and what it means for insurers.
During the first two months of 2014, exchange enrollees were more likely to use costly specialty drugs when compared to those with coverage outside of the exchanges, according to preliminary claims data released April 9 by Express Scripts.
According to the early data, six of the 10 costliest medications used by exchange enrollees were specialty drugs versus four of the top 10 used by commercial health plan enrollees. Of total prescriptions filled for exchange plans, 1.1% was for specialty drugs, compared with 0.75% in commercial plans — a near-50% difference.
Read more: http://www.digitaljournal.com/pr/1867253#ixzz2zipbRF40
Experts warn employers to prepare for high costs of specialty drugs
As if employers didn’t have enough headaches in managing their employees’ health benefits, now they face an emerging trend that carries an enormous price tag: the growing number of specialty drugs to treat complex medical conditions.
While the new generation of genetic-based specialty drugs, known as biologics, bring major breakthroughs in treating people, their costs are daunting.
Just one in 100 members of Blue Cross Blue Shield of Michigan use a specialty drug, but the class of pharmaceuticals now accounts for 30 percent of what the insurer pays out in pharmacy claims for all drugs, said Hiral Patel, a clinical pharmacist at BCBS.
“It seems like every single drug that is coming out to treat a rare condition has a hefty price tag,” Patel said during the recent health benefits seminar held by Advantage Benefits Group in Grand Rapids.
Specialty drugs taken orally, by infusion or injected to treat complex conditions such as cancer, multiple sclerosis, rheumatoid arthritis, hepatitis, inflammation, Crohn’s disease or infertility collectively carry an average cost of $2,475 per month per medication. That compares to an average cost of $280 for a brand-name drug and $32 a month for a generic drug, according to Blue Cross Blue Shield of Michigan data.
Patel cited one drug for cystic fibrosis that costs $365,000 a year.
See more at: http://mibiz.com/item/21456-experts-warn-employers-to-prepare-for-high-costs-of-specialty-drugs#sthash.htZNs7Lj.dpuf
Reference Pricing: Pharmacy Invoice Cost (ACTUAL) for Top Selling Generic and Brand Prescription Drugs
Why is this document important? Healthcare marketers are aggressively pursuing new revenue streams to augment lower reimbursements provided under PPACA. Prescription drugs, particularly specialty, are key drivers in the growth strategies of PBMs, TPAs and MCOs pursuant to healthcare reform.
The costs shared below are what our pharmacy actually pays; not AWP, MAC or WAC. The bottom line; payers must have access to “reference pricing.” Apply this knowledge to hold PBMs accountable and lower plan expenditures for stakeholders.
_1.jpg)
When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.
The costs shared below are what our pharmacy actually pays; not AWP, MAC or WAC. The bottom line; payers must have access to “reference pricing.” Apply this knowledge to hold PBMs accountable and lower plan expenditures for stakeholders.
_1.jpg){kind=spacer}
| How to Determine if Your Company [or Client] is Overpaying |
Step #1: Obtain a price list for generic prescription drugs from your broker, TPA, ASO or PBM every month.
Step #2: In addition, request an electronic copy of all your prescription transactions (claims) for the billing cycle which coincides with the date of your price list.
Step #3: Compare approximately 10 to 20 prescription claims against the price list to confirm contract agreement. It’s impractical to verify all claims, but 10 is a sample size large enough to extract some good assumptions.
Step #4: Now take it one step further. Check what your organization has paid, for prescription drugs, against our pharmacy cost then determine if a problem exists. When there is a 5% or more price differential (paid versus actual cost) we consider this a problem.
Multiple price differential discoveries means that your organization or client is likely overpaying. REPEAT these steps once per month.
— Tip —
Always include a semi-annual market check in your PBM contract language. Market checks provide each payer the ability, during the contract, to determine if better pricing is available in the marketplace compared to what the client is currently receiving.
When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.
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