Employers and health plans are missing significant prescription savings opportunities available today through improved formulary and benefit (F&B) data. Enhancing patient benefit data leads to better information at the point of prescribing and creates savings now for both payers and patients.
When doctors have access to actionable information within their electronic prescribing workflow, they are able to prescribe drugs their patients can afford while saving plan sponsors money. Presenting copays, coverage, and clinically relevant, lower-cost alternatives to the physician during the patient visit enables more informed prescription decisions and better drug cost management. The savings to plan sponsors and patients from this enhanced drug information can be substantial, even when as little as 5% of the improved messages are utilized by physicians.
Enhancing Formulary Data to Turbocharge Savings
There are several areas where plan sponsors can enrich formulary information and supplement what a PBM is distributing. This supplemental information is based on current formulary data and can lower plan, employer, and patient costs by tens of millions of dollars each year.
Brand Drug Alternatives
Determining alternatives to non-formulary drugs is a science and an art. It requires both identifying drugs that aren’t on formulary and providing options that are clinically equivalent. Communicating drug alternatives and offering equivalent strength information helps prescribers quickly find the right drugs for their patients.
Currently, many users of real-time information do not see drug alternatives because the data can be difficult for a payer to compile, especially when trying to comply with preferred brand contracts. Truly valuable Real-Time Pharmacy Benefit (RTPB) capabilities will require specific alternatives at the drug strength level in order to deliver relevant options to physicians. Payers have the opportunity now to improve drug alternatives information, communicate it to physicians, and optimize drug cost management without waiting for RTPB.
In a previous post we noted several generic pricing irregularities where certain doses or formulations were inexplicably overpriced. Our analysis showed that doctors could save their patients hundreds each year by prescribing a combination of doses or an equivalent form of the same medication.
The aggregate impact of these generic pricing irregularities could be costing health plans and employers significantly. The solution is to provide copay and pricing information to doctors, along with equivalent drug alternatives, so that they can help their patients find cost-effective prescriptions.
A simple claims analysis can identify the savings opportunities across many therapies where an alternative could reduce prescription costs by as much as 97.5% (97.5% is not a typo!) for another form of the same generic.
Total Drug Cost Information
As a growing number of physician groups are at risk for total costs, including drugs, communicating detailed cost information can provide guidance to physicians during the drug selection process. Physicians participating in these programs are incented to reduce prescription spending, but many don’t have access to the information needed to make the best choices. When these physicians know which drugs are preferred and their cost to both the patient and payer, they can prescribe medications their patients can afford and are more cost-effective for payers.
Drug Supply Limitations
Payers can use formulary and benefit information to communicate coverage restrictions such as days’ supply limitations, prior authorization, price transparency, and pharmacy selection. This saves doctors and patients from wrangling with prescription limitations that could prevent medication adherence.
Medical Benefit Information for Specialty Drugs
Though the purpose of formulary data is focused on the pharmacy benefit, there are opportunities to assist prescribers in selecting and gaining approval for medical benefit drugs. Offering messaging and weblinks within Electronic Health Records (EHRs) that provide more information on medical benefit coverage and restrictions can assist doctors with choosing the most affordable option.
The Role of Real-Time
Many PBMs haven’t fully optimized their formulary and benefit data sent to EHRs, leaving physicians without access to information critical to prescription decisions. While some market participants may be waiting for real-time tools to appear in EHRs, the Centers for Medicare and Medicaid Services have pushed back mandated RTPB implementation to 2021. Real-time is not the end solution to the problem of incomplete data but a different mechanism for conveying similar information and, ultimately, pushing preferred drugs. Formulary & Benefit can make drug selection more efficient by helping doctors select the right drug the first time. RTPB affirms the selection at a patient level.
Despite the delay in RTPB’s mandated rollout, health plans and employers can use the current system to guide physician drug selection. By enhancing formulary data with actionable information like prior authorizations, copays, plan drug cost and preferred drug alternatives, prescribers can choose medications that meet their patients’ financial and health needs while reducing prescription drug costs for all stakeholders.
The Continuing Value of Formulary and Benefit Information for Drug Cost Management
Once RTPB is in place, enhanced formulary and benefit information will still offer value to health plans and employers. While RTPB can pinpoint drug coverage information, prescribers must write most of the prescription before the check can be run. A prescription change requires checking a drug’s status individually. Doctors we surveyed in our physician roundtable expressed frustration at the time RTPB would require for reviewing then potentially rewriting scripts. This was especially a concern when writing generic prescriptions.
We believe that optimal drug cost management uses RTBT as a complement to formulary and benefit, which would be the primary source of information to guide a prescriber’s initial choice. The next version of F&B will also provide pharmacy selection guidance which real-time is unable to support. Real-time should be used to affirm the prescriber’s selection since it’s another opportunity to avoid pharmacy callbacks.
Start the Savings Process Today
Employers and health plans can begin the process of saving on prescription spending today. Enhancing formulary and benefit information is a methodology that works using technology already mainstreamed and currently available to virtually all ePrescribing physicians.
An opportunity analysis will determine your potential savings and the path to implementation. Payers who work with BenMedica can have optimized formulary information in place in as little as 8 weeks.
Contact us to get started or learn more about our process for creating e-prescribing solutions.