In the coming weeks and months, America will begin attempting to re-start the economy and hopefully take steps toward a semblance of a new normal. However, even as this process gets underway, our economy has been shaken to its core with ramifications that will reverberate for some time to come. In this new reality, America’s employers and health plan sponsors will face daunting challenges as a result of COVID-19’s impact.
That’s what makes the mission of pharmacy benefit managers (PBMs) all that much more important. PBMs are hired by employers and health plans to reduce costs and enhance access to prescription drugs, while helping to keep a lid on health-care premiums. Accomplishing these goals and continuing to find ways to help patients obtain their medications, while staying safe during the COVID-19 pandemic, are essential.
The coronavirus outbreak is first and foremost a human tragedy, affecting millions of people. It is also having a substantial impact on the global economy that has caused an explosion of unemployed Americans, many of whom rely on employer-sponsored health-care coverage. The safety-net programs, such as Medicaid and the Exchanges, will be more important than ever in providing needed coverage options for patients.
As an example of PBMs’ response to the growing number of uninsured as a result of COVID-19, there is a new program that will cap costs for a 30-day supply of generic medications at $25 and at $75 for more than 40 brand-name drugs for the rest of the year for medications, including insulin, contraceptives and products for heart disease and migraines.
Insurance plan sponsors – employers, self-insured plans, and others – for decades have relied on PBMs to manage prescription drug costs in a way that provides affordable access for the patient populations that they represent. PBMs have delivered on that need by achieving an overall low-cost trend by encouraging competition among drug manufacturers and drugstores.
In fact, recent research shows that PBMs will provide savings of more than $512 billion over the next decade for employer- and union-sponsored health plans and their workers and dependents. For 2020, it is estimated that an average per-person PBM savings on prescription drugs is $962.
Now, and in the future, reducing prescription drug costs will affect the overall economy and have implications beyond health care. Every dollar spent on health benefits is a dollar employers can’t spend to create new jobs, increase wages, or invest in innovation.
PBMs continue to implement patient-friendly tools in pharmacy benefits that lower prescription drug costs and improve quality, including negotiating discounts with drugstores to reduce copays and other out-of-pockets costs, negotiating price concessions from drug manufacturers, and promoting more affordable brand and generic drugs.
Drug manufacturers should be lauded for undertaking an unprecedented effort to find vaccines and treatments for COVID-19. But those treatments, once approved, must be made widely available and affordable for everyone, and just as importantly, medications for chronic illnesses must remain accessible for patients. PBMs’ proven track record keeping drug costs in check and providing patients access to treatments will be crucially important to achieving that objective.
As the economy re-emerges from this difficult time, Winston Churchill’s words are apt: “Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.”
During this uncertain time and beyond, patients and plan sponsors can count on PBMs to use their expertise and their negotiating power to provide affordable access to prescription drugs.