Mail-Service and Specialty Pharmacy Savings (Visante)
Demand for Convenience
On healthcare issues, poll after poll shows that cost is the greatest concern for both consumers and employers. At the same time, the growth of Amazon.com and other online retailers highlights greater consumer demand for convenience and home delivery.
With prescription drugs, these trends have led to greater use of high-tech mail-service pharmacies. While patients with short term, acute needs continue to use traditional drugstores, patients with chronic conditions increasingly rely on mail-service and specialty pharmacies to save money and get prescriptions delivered directly to their homes.
Traditional pharmacies are not equipped to fulfill this range of needed services, so payers and PBMs turn to the unique expertise of specialty pharmacies. Proposed state laws and regulations that restrict mail-service and specialty pharmacy options threaten to raise costs for both consumers and payers.
Visante projects 10-year savings (2015-24) for consumers, employers, and other payers of $311 billion, based on mail-service savings of $59.6 billion and specialty savings of $251.5 billion.
Compared to traditional drugstores, mail-service and specialty pharmacies offer deeper discounts and enhanced services. Based on Visante’s analysis, this generates substantial savings for the U.S. health care system:
- Mail-service pharmacies will save an estimated $5.1 billion for consumers, employers, and other payers in 2015, and $59.6 billion over the 10-year period 2015-24
- Specialty pharmacies will save an estimated $13.5 billion for consumers, employers, and other payers in 2015, and $251.5 billion over the 10-year period 2015-24
- Combined, mail-service and specialty pharmacies will save an estimated $18.6 billion for consumers, employers, and other payers in 2015, and $311 billion over the 10-year period 2015-24
Advantages of Mail Service
Mail-service pharmacies typically provide 90-day prescriptions for medications that consumers need on an ongoing basis. Consumers use mail-service pharmacies once they are stabilized on a medication, after having finished several 30-day prescriptions from their local drugstores.
Benefits of mail-service pharmacies include:
- Encouraged use of generic drugs
- Greater savings for consumers and payers by being vastly more efficient than traditional drugstores
- Dispensing accuracy rates up to 23 times better than drugstores
- Convenient access to 24/7 confidential counseling and answers to questions on prescription medications over the phone or Internet
- Improvement in patient adherence, thus improving health outcomes and reducing non-drug medical costs, such as hospitalizations
Advantages of Specialty Pharmacies
Specialty pharmacies are widely utilized by PBMs, health insurance companies, and plan sponsors to help manage prescription drug costs and improve quality of care.
Benefits of specialty pharmacies include:
- Highly trained teams of patient care coordinators, pharmacists, nurses, and insurance specialists, all working toward helping patients take complex medications safely and effectively
- Significant improvements in the quality of patient care relative to other distribution channels
- Coordinated benefit management strategies provide a savings advantage of 7-12% relative to other distribution channels, such as retail pharmacies and physician offices
- Reduction of expenditures on hospitalizations and other medical costs through a range of patient-centered services that enhance patient adherence to drug therapies, including patient education, training and monitoring, nursing and supportive care, case management, and 24/7 pharmacy support
Specialty Pharmacy Standards
Specialty pharmacies must meet many requirements to effectively handle injectable biologic medications, many costing thousands of dollars per dose. These requirements include:
- Providing round-the-clock access to pharmacists, nurses, and clinicians dedicated to and specially trained with respect to the disease state treated by the drug, the specialty drug itself, and the drug’s potential side effects
- Adhering to rigorous storage, shipping, and handling standards to meet product-label shipping requirements, such as temperature control, and timely deliveries of the product in optimal condition
- Performing disease-specific and drug-specific patient care management services that meet the unique needs of each patient and that incorporate multiple safeguards when dispensing and delivering the drug to ensure patient safety
- Collecting data and tracking outcomes for specific patients as required
- Managing compliance and persistency of drug regimens for patients
- Managing care within manufacturer Risk Evaluation and Mitigation strategies (REMS) program requirements, including REMS reporting, Phase IV trials, the dispensing of FDA trial drugs under strict protocols, and related clinical and cognitive counseling
Potentially Harmful Regulations
Savings through mail-service and specialty pharmacies will only be available if the legal and regulatory environment remains neutral toward such pharmacies. When state or federal laws or regulations place restrictions or prohibitions on the use of these pharmacies, savings are threatened.
Health plans, insurers, and PBMs typically use a variety of incentives to encourage their enrollees to use mail-service pharmacies, especially for maintenance medications. Legislation that prohibits plans from using automatic home delivery of 90-day refills for chronic medications limits the use of the lowest-cost pharmacy channel option.
In short, anti-mail-service legislation cut the use of mail-service pharmacies by more than 50%, which means that any resulting savings was also cut by more than 50%. Based on this experience, state or federal laws or regulations that place restrictions or prohibitions on the use of mail-service and/or specialty pharmacies could substantially increase prescription drug costs.
Resources & References
Mail-Service and Specialty Pharmacies Will Save More than $300 Billion for Consumers, Employers, and Other Payers Over the Next 10 Years. Visante. September 2014.