Rising Drug Costs, the Government, and the 2016 Election

PBIRx®

Intelligent Solutions in Pharmacy Benefits

612 Wheelers Farms Road, Milford, CT 06461

(888) 797-2479

Election year is always bound to include debate and discussion over major topics that the public has their eyes and ears on, and this year, one of the most pressing that we are following is rising drug costs - one piece of the health care puzzle that has been at the forefront of many conversations.

Thanks to recent price hikes, such as the one seen with EpiPens, it appears that more people are looking for answers from officials about the issues surrounding exceedingly high prescription costs. During a forum sponsored by RealClearHealth and Express Scripts earlier this month, congressmen and industry leaders took an interest in how the rising cost of drugs should be addressed. While some attendees from the left feel that caps on prescription drugs or negotiations between the Centers for Medicare & Medicaid Services and pharmaceutical manufacturers are the answers, others are looking for more transparency and expressed that there needs to be more congressional oversight. Another opinion is that the FDA needs to have a more efficient process for approving new drugs, as they currently have a “backlog of generics to approve,” which encourages prescription costs to keep rising (additional details about the forum available here, via RealClearPolitics).

The Presidential Candidates and Their Health Care Plans

A recent article by MedCity News reports that Democrat Hillary Clinton just announced her plan for how she will respond to “unjustified price hikes for long-available drugs.” Considering that drug makers have hiked prices for about 400 generic drugs by more than 1,000% between 2008 and 2015 alone, part of Clinton’s plan is to “establish dedicated consumer oversight at our public health and competition agencies.” She strives to bring together representatives of federal agencies that are responsible for ensuring health and safety, as well as fair competition, in order to create a group that is dedicated to protecting consumers from such price increases. Should we experience another price hike similar to what happened with EpiPens, for example, it would be this group’s duty to respond (read the full details of Hillary’s health care plans here).

Republican Donald Trump has also expressed his viewpoint on health care reform, with one of his main priorities being to repeal Obamacare. Should he be elected President, some of his other plans include:

1. To require price transparency from all health care providers, while permitting individuals to find the best prices for their medical needs.
2. To remove existing barriers to entry into free markets for drug providers that are offering reliable, safe, and cheaper products.
3. To give individuals the opportunity to fully deduct their health insurance premium payments from their tax returns under the current tax system.

Initiatives such as these have been designed for the purpose of reducing health care costs for more Americans, according to the campaign. Additional details about Trump’s plans can be found here.

Other Government and Health Care News

Insurers such as UnitedHealth Group Inc., Aetna Inc., and Humana Inc. recently announced that they will be pulling back from the Obamacare individual insurance market next year, and as such, earlier this month, President Obama and other health advisers met with other insurance companies to discuss how the marketplace can be strengthened before the open enrollment period begins in November. The President did openly acknowledge that improvements could be made to benefit both consumers and insurers, and says that his administration will focus on enrolling individuals who are still without health coverage, such as young adults. More on this available here, via The Financial Express.

As election day gets closer, be sure to connect with PBIRx on social media and check our blog regularly for updates on health care’s role in the election. For additional information, please call (888) 797-2479.

EpiPen Costs Skyrocket, Cause Outrage

PBIRx®

Intelligent Solutions in Pharmacy Benefits

612 Wheelers Farms Road, Milford, CT 06461

(888) 797-2479

We are sure you have heard some talk about the EpiPen lately, but in case you missed it, earlier this year Mylan raised the cost of a pack to be more than $600 - a significant hike from what it originally cost when the company first purchased the rights to the drug/device in 2007 (at that time, EpiPens cost about $57 each). Since 2007, NBC News reports that the following actions have been taken:

• In 2008 and 2009, Mylan raised the price of EpiPens by 5%.
• At the end of 2009, Mylan tried a 19% price hike.
• From 2010-2013, there was a succession of 10% price hikes.
• From Q4 of 2013 to Q2 of 2016, Mylan raised EpiPen prices by 15% every other quarter.

It is no surprise that consumers are outraged over the EpiPen's new cost, as these are used for life threatening allergic reactions. With the new school year approaching many have a need to purchase an EpiPen and provide it to the school nurse, but the cost has made this increasingly difficult.

So why is the price of EpiPens so inflated?

Although it only costs about a few dollars to make (CNBC reports that only about $1 worth of epinephrine is used in these devices), there is currently NO EpiPen generic available in the United States. However, after the uproar began and Mylan faced more scrutiny from both consumers and Congress, they just announced that they will be launching a generic version of EpiPens for about half of the current price ($300). Teva Pharmaceuticals is also working on its own generic version of the EpiPen, and expects to receive approval sometime next year.

Mylan has also taken other actions to try and make EpiPens more affordable to consumers and members, such as by increasing the consumer/member out of pocket cost reduction from "up to" $100 to "up to" $300 - more details available here.

All that said, it is important for payors to understand that increased costs will be experienced, not only because of the increase in prescription costs for EpiPens, but also because of increased and conceivably unnecessary utilization or stockpiling of the brand drug. Additionally, offering a coupon for EpiPens will result in higher costs because eliminating the member copay results in brand loyalty, even though a lower cost generic will be available soon.

This is where we at PBIRx come in. We fight for our clients to get the most value for their health care dollars, and are well aware of the tactics used by Big Pharma to take advantage of consumers. If you have questions about the recent EpiPen news or would like to learn more about how we can help you during this time, please call (888) 797-2479 today.

Medicare Proposes Lower Drug Reimbursements to Hospitals and Doctors

PBIRx®

Intelligent Solutions in Pharmacy Benefits

612 Wheelers Farms Road, Milford, CT 06461

(888) 797-2479

Earlier this month, Medicare announced a plan to change how they reimburse doctors and hospitals for certain medications under Medicare Part B in order to encourage them to choose less expensive drug treatments for patients. Specifically, the drugs to be targeted under this new proposal include intravenous medications, injectable drugs and some eye treatments. 

As of right now, the Medicare Part B program reimburses doctors and hospitals for the “average price” of the medication used plus an additional 6% fee. Thus, doctors and hospitals bring in more of a profit when they decide to use drug treatments that are on the expensive side. However, under a new reimbursement program, Medicare is proposing to lower the reimbursement for Medicare Part B drugs to “average price” plus 2.5% along with a flat fee of $16.80 per drug per day. As a result of the new method of reimbursement, the Centers for Medicare and Medicaid Services (CMS) hopes that doctors and hospitals would be more inclined to choose less costly treatments, especially since they often choose high-priced drugs even though lower cost, same efficacious therapies are available.

Value-Based Pricing

In addition to changing the way doctors and hospitals are reimbursed for certain services, CMS is also hoping to test what they call “value-based pricing” programs, something similar to what some pharmacy benefit managers and commercial health plans are already testing. One example is the indication-based pricing idea, which would cause reimbursement amounts to vary depending on how effective a drug is in treating a type of cancer. Essentially, if one particular type of cancer therapy is used to treat different conditions and has more success in one over the other, the plan is to pay for what works best for optimal health care outcomes at the lowest cost.

Medicare Proposal Critiques

Although some may welcome this proposal, many have expressed their concern - particularly some drug manufacturers and cancer doctors. In their eyes, this new plan is too heavily focused on saving money rather than the patient’s best interest. Furthermore, they suggest that following through with these changes to Medicare Part B could “limit access to care for some of the sickest Medicare beneficiaries,” according to The New York Times. Although the Obama administration has expressed that these changes are not intended to disrupt or interfere with a doctor’s true medical judgement or their ability to order Medicare Part B drugs when appropriate, doctors and hospitals continue to remain skeptical of the proposal.

As a pharmacy benefit consulting firm that works with a diverse group of clients including hospitals, we are always on the lookout for information about how they may be affected by industry changes. If you have questions about the Medicare Part B proposal or are curious to learn more about how it could affect revenue for certain companies and organizations, please do not hesitate to call PBIRx at (888) 797-2479.

PBM’s Earnings Lead To Higher Health Care Costs and Harm Patients

PBIRx®

Intelligent Solutions in Pharmacy Benefits

612 Wheelers Farms Road, Milford, CT 06461

(888) 797-2479

You are likely already aware that health care costs are continuing to rise, which naturally makes it more difficult for patients to receive the services they require. However, did you know that the actions and ultimately the earnings that PBMs take and make are two of the primary reasons for this? In fact, an article from the Wilson County News reports that “in 2012, the CEO of the nation’s largest pharmacy benefit manager, Express Scripts, earned about $1 million every week.” With an income so great on a weekly basis, let alone what individuals of this status earn every month and so on, it seems only fair to question where it all comes from.

A main reason that PBMs can achieve such high earnings is due to the fact that they refuse to pay for medications that patients require - the less they cover, the more money they keep in their pocket by preferring drug alternatives for which the PBM has negotiated significant rebates and fees that are NOT shared with the client. As they continue to deny coverage for certain drugs and services (here is a list of some drugs that PBMs CVS/Caremark and Express Scripts will be excluding in 2016), they also make it more expensive for patients to receive what they need. In turn, health care costs continue to rise across the board and, in some cases, patients get sicker when the out-of-pocket costs become too much to cover.

Though they are an important part of our health care system, you must realize that PBMs will go to great lengths for their own benefit, including the fact that they will keep rebates for themselves rather than pass them along to the rightful pharmacy or insurance provider - another reason their earnings are so high. As a result, we cannot stress enough how important it is for providing entities to have their pharmacy benefit contracts audited to ensure that the financial components of the Agreement are competitive today and that the PBM is complying with the terms within. At PBIRx, our number one priority is to keep our client’s PBM Agreement financial model continuously reviewed and negotiated so that they can enjoy the added savings versus the PBM increasing their profits.

Remember that PBMs renegotiate with their pharmacy network every year and benefit from new pricing. Clients however, negotiate their PBM Agreement once every 2-5 years and at year two or three it is the PBM that has benefited from any new pricing, not the Client.

If you suspect that your PBM is holding back rebates that you are entitled to, or if you simply want to have your contract audited to ensure that your plan is being carried out correctly, do not hesitate to give us a call at (888) 797-2479. 

For more information about our services and how YOU can take control over your health care costs, please visit us on our website today.

The Benefits Of Working With PBIRx

PBIRx®

Intelligent Solutions in Pharmacy Benefits

612 Wheelers Farms Road, Milford, CT 06461

(888) 797-2479

As health care costs continue to rise, the need for a team who can help ensure that you are paying the right price for various services is extremely important now more than ever. Though you likely contract with a Pharmacy Benefit Manager that adjudicates pharmacy claims at a significant profit margin and a "Medical" broker/consultant, there is a significant cost savings opportunity in working with PBIRx, an independent Pharmacy Benefit Auditing and Consulting firm, that can assist in returning some of that profit back to your benefits budget. After 25 years, PBIRx is proud of our growth of successful clients, who use our intelligence in the form of proprietary clinical algorithms and technology along with a dedicated team of experienced professionals with longevity in the pharmacy benefit industry.  

But why is PBIRx the right partner to move your PBMs profits to your budget? 

To start, PBIRx's proprietary AuditRx program and experience in hours of negotiating pharmacy benefit recoveries with various PBMs at a senior level gives clients a unique edge in understanding how discounts, guarantees and other fees in a PBM Agreement change with language in fine print. This experience translates to starting with an optimal PBM Agreement giving clients an immediate 10%- 15% savings adjunct to implementation of proprietary clinical algorithms, which identify client specific clinical programs resulting in an additional 10% -15% savings.

Next, pharmacy claims data is reviewed monthly so that plan design and clinical savings opportunities can be identified on a continuum. A recent example is when the manufacturer of the drug Glumetza for diabetes increased the AWP by 500% in late June of 2015. For one client with one member, the cost for one prescription increased to $9,300 from $1,700. PBIRx immediately reached out so that the prescribing physician was made aware of the significant cost increase with alternative lower cost therapeutic alternatives saving the client what could have been a $100,000 cost increase for one member with one prescription. 

All plan design recommendations are provided with member disruption (if any) and estimated savings, which is measured and provided back to the client comparing PBIRx projected savings to actual savings. This is a huge benefit to our clients because it provides them with the opportunity to truly see how much money they have saved as a result of our ongoing analyses. PBIRx has several proven proprietary plan design savings that go well beyond optimal PBM contract discounts and clinical programs with an increase in member cost share as a very last option.

Furthermore, facilitation of implementation of all recommendations are provided by PBIRx experts that pay attention to the detail required including physician and member communication materials. PBIRx becomes a team member for all our clients specializing in all aspects of the pharmacy benefit from their in house pharmacy, if any, to 340B audit and compliance, PBM contract negotiation and management of all financial terms and reconciliation of guarantees, invoices and rebates. PBIRx experts are also face to face with members to present all aspects of the pharmacy benefit and to be available to answer any questions at all open enrollment meetings.

Last, but certainly not least, the PBIRx team of experts provides several ad hoc reports including allocation rates, disease/drug compliance metrics, cost increase or decrease based on various copay options, patient assistance program facilitation, and challenges when PBMs recommend programs that actually increase client costs under the guise of pharmacy benefit management "cost savings" recommendations. For our Accountable Care Organization clients projected metrics have always been within 1% of accuracy.

To learn more about our services, ask questions, or request a courtesy PBM contract review, please visit us on our website or dial (888) 797-2479 today.

Reasons Behind Non-Adherence in Patients

PBIRx®

Intelligent Solutions in Pharmacy Benefits

612 Wheelers Farms Road, Milford, CT 06461

(888) 797-2479

When presented with a medication or other health care service, one would naturally assume that the patient who received it would follow through. However, recent reports have shown that many patients actually fail to comply with several health care services, particularly prescription medications, and unfortunately, this has led to an increase in health care costs.

Earlier this month, Express Scripts reported that "non-adherence is a major contributor to skyrocketing health care costs as well as higher rates of hospital and ER visits for patients who do not take their medications." But why exactly are patients leaving their medications in the dust? Well, the report further explained that 69% of non-adherence by patients is a result of certain behaviors such as forgetfulness, procrastination and even confusion; when patients have multiple medications to take, it can be easy to get things mixed up. Additionally, aside from the patient's own behavior, the cost of such medications has also proven to be a cause of non-adherence in 16% of cases. Lastly, 15% of non-adherence is due to clinical side effects, according to the data provided by Express Scripts.

So what can be done to combat this issue? First and foremost, if a medication is too expensive or causes severe side effects, the first plan of action should be to switch it for that particular patient. Or, if there is no alternative, health care providers should work with the patient as closely as they can to make their current situation work. If copayments for mail order prescriptions and if mail order discounts are competitively negotiated by an independent third party like PBIRx, home delivery for medications can offer patients reminders so that they don't lose track of when it's time to take or renew a medication.

To learn more about non-adherence in patients, including how it is directly linked to rising health care costs, check out this article from HealthIT Analytics.

At PBIRx, we understand just how big a role non-adherence plays in health care costs. And as a company whose main priority is to reduce costs wherever possible for our clients, we encourage you to contact us if you're struggling to keep up with the rise in prices for prescription medications so that we can audit your pharmacy benefit plan. For more information, please call (888) 797-2479 or visit us at www.pbirx.com today.

PBIRx Presenting At 340B Coalition Annual Conference

PBIRx®

Intelligent Solutions in Pharmacy Benefits

612 Wheelers Farms Road, Milford, CT 06461

(888) 797-2479

From July 13 to July 15, members of the PBIRx team will be attending and presenting at the 340B Coalition Conference in Washington D.C. This conference is designed for covered entities, consultants, compliance experts and other individuals in the pharmaceutical field who work hand in hand with the 340B program on a regular basis. As a company that specializes in performing 340B compliance audits for our clients, we are extremely excited to have the opportunity to present and learn more about the future of 340B.

PBIRx is honored to be chosen to present "Independent HRSA 340B Compliance Auditing" during the Vendor Perspective Session on Tuesday, July 14th at 3:45 PM.

The agenda for this year's conference includes, but is not limited to:

• Stories from real life patients about their experience with the 340B program
• A discussion on the various ways that 340B savings can improve care for patients
• Tips on how to identify 340B compliance issues as well as how to solve them (this is especially important to our team as 340B compliance audits are one of the services we offer!)
• Updates from those at the legislative level on any program changes that may be taking effect
• Information on the rise of specialty drugs and limited distribution networks, including how this impacts covered entities

Here at PBIRx, our 340B compliance audits are completed on-site by a team of pharmacists, analysts and specialists in pharmacy benefits. We are available to provide detailed reports that prepare providing entities for actual HRSA audits, and will offer as much information as possible when it comes to any discrepancies in behavior that could cause one to lose their 340B status. 

Our ongoing services range from targeted claims review to full 340B committee member for covered entities.

For more information about our compliance audits, please visit www.pbirx.com or give us a call at (888) 797-2479.