2009 Drug Trend Insights - Prime Therapeutics

Specialty Drug ManagementFormulary ManagementOffers SavingsWithin some Specialty drug classes,the available options for therapyare growing. This presents anopportunity to establish a formularyand negotiate deeper discounts forpreferred drugs.Our formulary development teamhelps establish a preferred druglist based on the clinical safety,efficacy and uniqueness of eachdrug in each drug class. When plandesigns include Specialty drug tiers,as we recommend, plan sponsorscan establish benefit incentives toencourage formulary compliance(the use of preferred drugs on theformulary). Both members and plansponsors save when preferred drugsare regularly chosen.Design Plans to DriveEfficient DeliveryPlan sponsors generally achievethe most aggressive discountson Specialty medications whenutilizing a preferred or exclusiveSpecialty pharmacy program suchas Triessent. In many cases, use ofthe preferred network is encouragedthrough in/out-of-network benefitsor a retail lockout, in which drugsare only covered when obtainedthrough an approved deliverychannel. In addition to moreAn effective discount is different from acontracted discount rate.It represents the average discount achieved on the specific drugs used by members in a givenperiod of time. The effective discount reflects member choices about which drugs to use andwhere to obtain those drugs. Plan sponsors can improve the effective discount by structuringbenefit plan designs and clinical programs to encourage the selection of the most effectivedrug at the lowest cost and use of the most efficient delivery channel.aggressive discounts, this providerrelationship offers advantages suchas streamlined processes, consistentreporting and the opportunity forintegrated care management.Triessent offers aggressive networkdiscounts on Specialty drugs.The effective discount achievedby our Triessent book of businessin 2008 was 17.3 percent. Thetop 25 percent of Triessent clientsachieved an effective discountof 18.9 percent or better.The effective discount is stronglyinfluenced by member choices.Thus, through effective benefitplan design, plan sponsors can playa big role in maximizing the valueof Triessent discounts.“Buy and bill,” the common practiceof providers purchasing and sellingexpensive Specialty drugs, is drivingup the cost of health care. Plansponsors can minimize these “buyand bill” occurrences by reducingprovider reimbursement rates,adjusting administration fees andmandating appropriate codes forclaim submissions.54 Connect ● Create