Benefits January 7, 2003

Companies Save on Generic Drug Costs Under Wellpoint Plan

January 7, 2003 (PLANSPONSOR.com) - In an effort to spur its members' use of generic drugs, one of the nation's largest health insurers is cutting generic drug prices to employers or offering them for free to employees.

Reported by

Fred Schneyer

Reuters reported that big employers would have a zero copay for the generic equivalents and smaller employers would get up to a $10 copayment discount, under the plan by WellPoint Health Networks Inc.

WellPoint said that it would also refund the full price of a drug’s cheaper counterpart to encourage its 13 million members to switch to generic versions of popular medications such as Eli Lilly & Co.’s Prozac and Merck & Co. Inc.’s Mevacor, according to the Reuters story.

WellPoint says about 50% of its members already use generic drugs when faced with a choice of a brand name and a copycat version.

Soaring prescription drug prices, a key driver of double-digit growth in medical inflation, is weighing on the health care system and employers’ bottom lines.