For most illnesses, when a doctor writes a prescription it is typically an easy fill at the neighborhood pharmacy. However, some medications for more serious and complex medical conditions require medications that have a higher list price. And, unfortunately, these are drugs the neighborhood pharmacy typically does not carry.
That’s where specialty pharmacies come into play. This year, Gratiot-Isabella Regional Educational Service District (RESD) in Michigan is making things easier for members who require the use of a specialty pharmacy company. Specialty pharmacy drugs are those medications classified as high-cost and highly complex. This often includes biologics, which are injectable drugs becoming popular for conditions such as rheumatoid arthritis and types of psoriasis. A recent report by The Pharmacy Times speculates that about half of prescribed drugs in 2020 were going to be classified as specialty drugs. That report predicted the specialty drug business to about $500 million in the United States this year. Medicare defines any drug for which the negotiated price is $670 per month or more as a specialty drug, which is placed in a specialty tier that requires a higher patient cost sharing.
Through a new partnership with Walgreens, RESD members will be able to receive their specialty medicines from one entity -- AllianceRx Walgreen Prime program. The program will allow for medications that are self-administered and classified as specialty drugs that are not available at the neighborhood pharmacy to be shipped directly to the homes of RESD members. If members do not want the medication shipped to their homes, the AllianceRx program allows medications to be sent to the closest Walgreen’s retail store for pick-up.
The new program goes into effect on Sept. 1, says an account executive with Brown & Brown of Central Michigan, Inc. Melissa Ramos. As Ramos reminds, the changes to the RESD program only pertain to those drugs that are traditionally filled by specialty pharmacies, and only those that are self-administered by patients. Those types of medications include drugs for cancer, multiple sclerosis, HIV, hemophilia, inflammatory bowel disease, rheumatoid arthritis, chronic kidney failure and others. Specialty drugs account for a significant percentage of new drug approvals by the U.S. Food and Drug Administration
The reason Gratiot-Isabella RESD opted to enter this Walgreen’s program was to save money, Ramos says. For several years, the upward trend in insurance cost has been based on prescription drugs, Ramos notes. In particular, the costs were primarily associated with those medications classified as specialty drugs. Many of these types of drugs have a high list price which can run into the tens of thousands of dollars. As an example, Ramos points to some new medications that provide a virtual cure for hepatitis C that have a list price of more than $30,000. The list price is the price set by drug manufacturers and is then negotiated by payers. The list price is rarely the retail price a consumer pays.
“In a self-funded group, this can get really expensive and the idea was to save funds for these specialty medications,” Ramos says.
Ramos reminds that the new program is only for medications that are self-administered. For patients who require medications that are administered at infusion centers, nothing will change. Those patients will still go to the centers for treatment. Ramos adds that those medications are not typically covered through prescription benefit plans but covered under medical insurance programs.
While the change in specialty drugs is coming, Ramos says there are no other changes with benefits, so RESD clients will not have to worry about that. More information will be forthcoming to RESD members in August, ahead of the Sept. 1 start date. Ramos says the global pandemic caused by COVID-19 hindered some communication plans to members during the latter part of the school year. With economies opening back up in the early summer months and larger groups being allowed to gather, Ramos hopes that it will continue in order for these meetings to be held as planned.