Survey: Companies Savings Bucks on Drug Costs

March 12, 2004 ( - Some employers' health-care cost-cutting efforts appear to be working - at least when it comes to the cost of prescription drugs, a new industry survey found.

AdvancePCS, an Irving, Texas-based health plan services provider, said its clients spent 10.3% more on prescription drugs in 2003 than the year before, compared with a national average spending hike of 13.4% as estimated by the Center for Medicare and Medicaid Services. AdvancePCS clients’ 2003 drug spending increases ranged from 3.3% to 10.9%, according to a company news release.

Among the reasons for the drug–spending trend, according to the company:

  • a three-tiered plan design, which sets a co-payment or coinsurance payment for each drug classification (generics, preferred brands, nonpreferred brands)
  • formulary management, which encourages the prescribing of lower-cost, therapeutically appropriate drugs
  • specialty pharmacy management, offering a single distribution source for this high-cost drug spend category coupled with pharmacy benefit management-based electronic claims processing and clinical care
  • generic incentive programs, encouraging members to try lower-cost, clinically appropriate generic medications
  • mail pharmacy utilization, designed to improve member health through home delivery of maintenance medications with savings for clients and patients alike
  • utilization management, which reduces unnecessary drug use by helping to ensure that drugs are used appropriately and in compliance with prescribed instructions by patients who require them.

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