At Benmedica, we call this “savings by a thousand cuts”- the incremental, often-overlooked savings opportunities that, when combined, create meaningful financial impact across the healthcare system.
Recent research highlights the urgency of addressing prescription drug costs. Studies show that switching from high-cost generics to lower-cost therapeutic alternatives can reduce spending by up to 88% while maintaining clinical efficacy.¹ Meanwhile, a formulary-driven study found that such substitutions cut total drug costs from $7.5 million to approximately $873,711, demonstrating the power of incremental savings.²
Real-world data from health plans using Benmedica’s SmartAlts® solution demonstrates significant cost savings, with over $90 million saved in the first eight months - including $6.5 million in the first month alone—driven by seamless provider adoption. Further analysis shows that nearly half of these savings came from high-volume, lower-cost drug alternatives, highlighting the powerful impact of data-driven formulary optimization in reducing costs while maintaining clinical effectiveness.
Beyond Big Savings: The Power of Small Wins
Traditional cost-saving strategies tend to prioritize high-cost drugs with the largest price tags. However, this approach leaves substantial savings on the table by overlooking smaller but frequent opportunities that create a major cumulative impact. Consider:
✔ Lower-cost alternatives in widely prescribed drug classes (e.g., antibiotics, antihypertensives, cholesterol medications) generate massive cumulative savings across a population.
✔ Therapeutic substitutions in less-targeted categories (e.g., dermatology, gastrointestinal drugs) uncover hidden savings that would otherwise go unnoticed.
By making these small, consistent optimizations, payors, PBMs, and health plans can scale incremental savings into measurable financial and operational benefits. A recent analysis demonstrated that shifting just 5% of prescriptions to lower-cost alternatives in a 500,000-member health plan resulted in millions in annual savings.³
Unveiling Hidden Value with SmartAlts®
Benmedica’s SmartAlts® engine is built to unlock and deliver these hidden savings opportunities at scale. With a robust dataset of 18,000 drugs and 1,200 subsets of therapeutically similar alternatives, and proprietary clinical algorithms, SmartAlts® ensures cost-effectiveness without compromising clinical outcomes.
How SmartAlts® Drives Savings:
✔ Comprehensive Drug Class Analysis – Goes beyond high-cost drugs to identify savings in all therapeutic areas.
✔ Real-Time, Actionable Insights – Embeds data-driven alternatives directly into prescribing workflows.
✔ Compounding Cost Reduction – Small medication shifts (brand to generic, generic to lower-cost alternative) accumulate into major savings.
Case in Point: In a recent formulary adjustment, switching Budesonide-Formoterol to Symbicort as a preferred option resulted in $465,000 in savings within five months, proving that even minor changes can have a dramatic financial impact.³
Why Drug Alternatives Matter More Than Ever
The POCP Whitepaper highlights how traditional formulary management strategies have historically been static and underutilized, providing limited visibility into cost-effective alternatives. SmartAlts® changes this by embedding intelligent drug alternatives directly into prescriber workflows, reducing friction, improving adherence, and optimizing drug spend at scale.³
Transforming Small Wins into Big Results
At Benmedica, we believe that hidden value in drug alternatives is too important to ignore. Savings by a thousand cuts isn’t just a concept - it’s a strategic approach to drug benefit optimization.
With SmartAlts®, health plans, PBMs, and employers can tap into millions in savings while improving provider and member experiences.
Are you ready to unlock the hidden savings within your medication benefits? Contact us today to learn how Benmedica’s SmartAlts® solutions can help.