Healthy Skepticism Library item: 10520

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

Publication type: Journal Article

Theodorou AA.
How 3-tier plan design and other strategies yielded $1.6 billion in cost savings
Drug Benefit Trends 2003; 15:(3):45-54

Abstract:

With the challenge of managing escalating pharmacy costs, the use of plan design to contain the costs of providing prescription drug benefits is becoming increasingly important to health care payers. This article describes the results of a comprehensive 2-year retrospective analysis of pharmacy benefits for 8.1 million members who belong to 246 plans managed by AdvancePCS. All plans studied use a 3-tier copayment benefit design. Enrollment in these plans ranged from more than 550,000 members to just a handful of members in start-up entities. By implementing 3-tier copay, negotiated pharmacy network, and drug utilization review, along with other enhancements, these plans realized a combined savings of more than $1.62 billion between January and December 2001.