In an industry that is continually berated this might be refreshing to hear. One insurer is battling the Big Pharma by educating doctors on what is cost efficient for medical use in terms of generics, instead of pushing brand name drugs for huge profit margins. The concept is best illustrated through the article:
“Valeant Pharmaceuticals had cranked up the price of one common dosage of its Glumetza medicine for lowering blood sugar to an astonishing $81,270 a year, according to Truven Health Analytics, a data firm. Meanwhile a similar, generic version can be bought for as little as a penny a pill.”
This strategy is keeping the insurer’s drug spend percentage increase in the single digits, before the strategy was implemented the increase was in the double digits. This insurer is tackling the cost of pharmaceutical spend, but how can other employer’s use similar strategies to save their plan costs? One option is utilizing a self-insured plan to gain better control on pharmaceutical spend. Through self-funding the employer gains control of their plan and allows them to be creative with their plan language.
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