Prescription Drug Costs Are Like A Runaway Train. Annual Cost Increases In Recent Years Have Averaged 7% to 15%, and Experts Project Even Greater Increases In the Future.
Here Are A Few “Starter” Ideas For Reversing This Run-Away Trend. Join the National Prescription Coverage Coalition, and you’ll automatically take advantage of each of these ideas, and many more.
Obtain An Entirely Different PBM Contract: Most PBM/Client contracts enable PBMs to generate “profit spreads” in numerous ways, rather than requiring PBMs to “pass through” every cost and all potential savings to clients.
Thus, the “Brand Drug” and “Generic Drug” and “Specialty Drug” definitions allow PBMs to mischaracterize drugs, shift them from one category to another, and thereby evade contract pricing terms and guarantees. MAC Definitions allow PBMs to charge essentially whatever they want for generic drugs. And PBMs retain most drug manufacturer payments and discounts through a host of boilerplate “Rebate” terms that PBMs draft and include in clients’ contracts.
Accordingly, the key to reversing your ever-increasing drug costs is to rely on an entirely different form of contract. The Coalition has drafted the most detailed and extensive PBM contract in the nation – with more than 150 pages of contract terms – all designed to eliminate PBMs’ standard loopholes and ensure better services at lower costs.
Continuously Monitor the Rx Marketplace. The drug marketplace is continually changing.
New Generic Drugs enter the market, and approximately 180 days later, their prices plummet. But few health plans obtain the benefit of those lower costs immediately, and many have not done so months or years thereafter.
New-to-market Brand Drugs – and Specialty Drugs – also are continuously entering the market, some with extraordinary new therapeutic benefits, but many offering little therapeutic value. Few health plans have the time or resources to evaluate these new drugs. And almost no health plans are positioned to ensure these new drugs are priced at available marketplace costs.
Other marketplace changes are also continuously driving up health plans’ costs. Drug manufacturers are offering coupons, undermining health plans’ efforts to guide their plan beneficiaries to lower cost drugs. Specialty Pharmacies are creating new compound creams – with no proven efficacy, but at extraordinarily high costs – and marketing these creams to doctors to generate more and more prescriptions. However, few, if any health plans – or PBMs – are addressing these new developments.
The Coalition will monitor all these developments for every Coalition Member, take the steps necessary to protect your health plan, and control your drug costs as a result.
Conduct Regular & Thorough Audits. Most health plans contract with an insurance company or PBM, and then because of the health plans’ limited resources, the plans ignore their prescription coverage and move on to other more pressing issues. For those few health plans that conduct audits, their audits are of PBM contracts that are so stuffed with loopholes that the audits prove to be of limited, if any, value. And unbeknownst to the health plans, their auditors have signed Confidentiality Agreements imposed by PBMs, which bind the auditors not to investigate or disclose certain matters to their own clients!
The key to reversing this trend is to (i) execute an airtight PBM contract; (ii) regularly audit the contract thereafter; and (iii) rely on a conflict-free audit firm with real industry expertise. Our Coalition will provide a conflict-free audit of the Coalition’s airtight PBM contract to every Coalition Member, every year, as part of our Coalition Member Fee.
Contact the National Prescription Coverage Coalition and talk with our experts, and we’ll help you understand the steps you need to take to immediately decrease your prescription coverage costs.
