Changing
the Drug Reimbursement Landscape
Conversation continues as to which drug price benchmark should replace
average wholesale price (AWP). As this occurs, the need for systemic
changes to drug pricing and reimbursement should be addressed. With
the lawsuits against drug database publishers resolved, the demise
of AWP is likely and a different benchmark will be needed.
Simply
changing the drug price benchmark does not create a more accurate
and valid system of pricing drugs. Figure 6 shows the complex, three
layers of drug pricing.
Pharmacy
reimbursement and third-party drug claim pricing are complex issues.
Payers want to understand more about how drug pricing, reimbursement,
and PBM revenue streams are calculated. In keeping with a greater
emphasis on transparency in the market, drug benefit plan sponsors
want transparency in drug pricing methodologies as well.
It
is important for plan sponsors to advocate for a system that is
transparent, rational, and intelligible. Product reimbursement should
approximate average acquisition costs. Pharmacy dispensing fees
should provide fair compensation for services provided to patients.
The
system should include incentives for providers and pharmacies to
manage drug therapies in a cost-effective manner. The ideal price
benchmark should be:
- Accurate
and reliable
- Clearly
defined operationally
- The
simplest methodology possible to yield meaningful values
- A
reasonable estimation of average acquisition cost
- Sensitive
to class of trade issues
- Updated
and reported on a timely basis
- Verifiable
and auditable
Systemic
change will take time and implementation will be challenging. Changes
to retail pharmacy systems and claims adjudication systems will
be necessary. All third-party contracts – payer-PBM, PBM-pharmacy,
manufacturer rebate agreements – will need to be renegotiated.
The payoff will be an alignment of goals for providers and payers.
In
the Short Term...
There are two steps that plan sponsors can take right now.
The
first is to evaluate current pharmacy management contract(s) for
the ability to renegotiate or adjust terms based on industry changes.
The
second step is to monitor industry dialogue about pharmacy reimbursement.
|