Decreasing Drug Costs – Here’s How We Achieved Them

We’re pleased to report that the National Prescription Coverage Coalition has yet again achieved striking savings for our Coalition Members. 

Based on year-end analyses, our Coalition Members decreased their prescription coverage costs by approximately 20% to 30%.

Sound too good to be true? It’s not.

These savings resulted from dozens of continuous  recommendations that our Coalition experts provided to our Coalition Members, including:

  • Excluding coverage for dozens of high-cost drugs that could be appropriately replaced with inexpensive over-the-counter drugs or low-cost prescription generics
  • Updating and improving our Coalition Members’ customized Formularies
  • Implementing customized Prior Authorization protocols drafted by our Coalition experts
  • Taking advantage of Specialty Drug coupons not only to offset Plan Beneficiaries’ costs but also to reduce our Coalition Members’ costs
  • Improving Benefit Plan Designs to incentivize beneficiaries to pay attention to drug costs


Our Coalition experts also continuously monitored:

  • Brand drugs that lost their patent protection, and recommended the immediate replacement of all such drugs with lower-cost generics
  • Marketplace changes in the prices of all drugs, and recommended specific actions in connection with certain drugs whose costs increased dramatically
  • The FDA’s approval of all new-to-market drugs, and recommended the exclusion of all copy-cat and other drugs that provide little new value but carry high prices


Here’s an example of the cost decreases achieved by one of our Coalition Members after it implemented a host of recommendations on January 1, 2017:


Continuous & Ongoing Savings Achieved by Another Coalition Member

As reflected by the Table below, another Coalition Member joined our Coalition in April 2015 and obtained immediate savings, but given our experts’ ongoing recommendations, costs continued to decrease in 2016, and fell even further in 2017:


Because this Coalition Member was located in a metropolitan area, our experts knew this Coalition Member could achieve savings by eliminating one of the two high-cost retail pharmacy chains – CVS or Walgreens – and getting stronger discounts from the other chain.

Working with the PBM (Envision) that provides services to the Coalition, our experts determined which chain pharmacy would provide the greatest discounts if the other chain was excluded. Then we verified that all plan beneficiaries would still have strong access to retail pharmacies within a few miles of their homes. And then we provided three months of notice to all plan beneficiaries to ensure they would have adequate time to change where they filled prescriptions when the Coalition Member implemented its new, customized Limited Pharmacy Network.

In short, given the Coalition’s ongoing and continuous recommendations, this Coalition Member’s costs continuously decreased since joining the Coalition. And almost three years after joining the Coalition, its costs are far lower than they were before it joined the Coalition.

Contrasting Experience of Other Plans Nationwide

While our Coalition Members’ costs have been decreasing by 20% to 30%, other Plans’ costs have been increasing over time.

We routinely learn of Plans whose costs increased by 5 percent to 10 percent last year. According to one analysis, prescription coverage costs increased on average for those under age 65 by 11.6 percent, and for those 65 and older by 9.9 percent. Both Express Scripts and Caremark have reported continuous increases during the past several years as well.

Why the difference between our Coalition Members’ experience, and other Plans?

  • Most Plans have PBM contracts in place that are stuffed with loopholes that allow PBMs to charge essentially whatever they want for many drugs. Our Coalition contract is free of all loopholes.
  • Under most Plan’s PBM contracts, PBMs can retain a large portion of the monies they collect from manufacturers, as long as the PBMs label the monies with names other than “Rebates”. Under our Coalition contract, all third party monies must be passed through to our Coalition Members.
  • Most Plans rely on their PBMs’ “standard” Formularies and “standard” Prior Authorization and “standard” Step Therapy Programs, notwithstanding PBMs’ conflicts of interest and secret relationships with manufacturers. Under our Coalition contract, we have the right to individually customize each Coalition Member’s Formulary and Programs, and we do.
  • Most Plans are without the resources to pay any attention – let alone respond – to marketplace changes. As a result, they do nothing to combat dramatic increases in drugs’ list prices, or to exclude new high-cost drugs that are approved by the FDA but offer little in value. Also, most Plans fail to end coverage immediately for brand drugs that lose their patents, when lower-cost generics become available. Our Coalition experts make certain that our Coalition Members address all these marketplace changes.

We urge you to evaluate your Plan’s cost trends. What have they been over time?

Have you achieved the cost decreases that our Coalition has provided to our Members?

Is your Plan positioned to respond to marketplace changes in the future?

How Much In Cost Increases Can Your Plan Absorb?

Recent government projections reflect prescription costs will increase by 6.3 percent annually through 2026. Several actuarial firms project mid- to steep increases for prescription coverage this coming year and beyond.

If your Plan can’t absorb ever-increasing prescription coverage costs, consider contacting our firm to determine what your Plan might do to decrease its costs. For a few thousand dollars, we’ll conduct an extensive claims data analysis and provide detailed recommendations about what your Plan can do to significantly decrease its costs.

We’ll also analyze your costs at different pharmacies, and assess the savings you might achieve were you to create a Limited Pharmacy Network.

And if you’re interested in doing so, we’ll project the savings you’ll obtain from joining the National Prescription Coverage Coalition. We have a proven track record that demonstrates we will decrease your Plan’s costs as soon as you join the Coalition, and help your Plan sustain lower costs over time.

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