PBMs are moving products to non-covered status
Express Scripts and CVS Caremark are expected to expand their list of non-covered drugs for the 2015 plan year, leading to challenging pricing negotiations between branded pharmaceutical companies and pharmacy benefit managers (PBMs). Given the Affordable Care Act (ACA), industry watchers are not surprised.
“Narrowing pharmacy networks and limiting pharmacy risk exposure has become more important under ACA-compliant benefit offerings,” according to F. Randy Vogenberg, PhD, RPh, principal, Institute for Integrated Healthcare, Greenville, S.C. “That creates obvious conflicts with select branded firms particularly in the traditional pharmaceuticals arena making contract negotiations high-pressured.”
For managed care and health-system decision-makers this could mean more pressure on balancing network issues between clinical performance and economic impact, according to Vogenberg.
“For example, limited drug choice for patient use or increased risk sharing from a PBM shifts cost exposure to the provider versus the payer,” he says.
Express Scripts moved 48 products to “not covered” status for its 2014 National Preferred Formulary, which is the selected formulary for approximately 30% of its members, according to David Whitrap, Express Scripts spokesman. In doing so, the company is able to save its clients more than $700 million this year, he says.
The excluded medications represent about 1% of all of the products currently on the PBM’s formulary, and “nearly all of them have copay cards that drive up the overall cost of care,” he says.
Also, the CVS Caremark Preferred Drug List (PDL) reflects the PBM’s recommendations to provide comprehensive coverage and reduce overall costs, according to CVS Caremark spokeswoman Christine Cramer.
“A number of the drugs removed from the PDL for 2014 are high-cost, non-preferred drugs with very low utilization,” she says.