Blue Shield of California teams with Amazon, CVS and others on new prescription drug model
The initiative is designed to lower prescription medication costs by roughly $500 million annually once the model is fully implemented.
Photo: Jeff Lagasse/Healthcare Finance News
Blue Shield of California will be rolling out a new pharmacy care model, teaming with a number of organizations on an initiative designed to lower prescription medication costs to the tune of about $500 million annually once the multiyear strategy is fully implemented.
Blue Shield intends to make this happen via partnerships with companies "that share Blue Shield's vision for more affordable and transparent pharmacy services," according to the organization.
The Pharmacy Care Reimagined initiative, as it's been called, "will help provide its members with convenient, transparent access to medications while lowering costs," according to Blue Shield.
WHAT'S THE IMPACT?
Data from the Centers for Disease Control and Prevention show that most American adults take at least one prescription drug annually. Already a significant cost, total prescription drug spend in the U.S. is consistently rising. In 2021, the American healthcare system spent more than $600 billion on prescription drugs – about $1,500 per person, per year, according to the Centers for Medicare and Medicaid Services.
Blue Shield contends that the current pharmacy care system rewards some stakeholders for selling more drugs at higher costs. The organization is seeking to transform the system into a value-based model that provides members with the medications they need at a more affordable cost.
"The current pharmacy system is extremely expensive, enormously complex, completely opaque, and designed to maximize the profit of participants instead of the quality, convenience and cost-effectiveness for consumers," said Paul Markovich, president and CEO of Blue Shield of California. "That is why we are working with like-minded partners to create a completely new, more transparent system that gets the right drugs to the right people at the right time at a substantially lower cost."
Contending that up to a dozen companies can be involved in the process from when a drug is made to when a member receives it, Blue Shield selected five companies it said shares its philosophy of simplifying the system and cutting unnecessary costs.
As part of the model, Amazon Pharmacy will provide free delivery of prescription medications, complete with status updates, as well as upfront pricing and 24/7 access to pharmacists. Mark Cuban Cost Plus Drug Company will establish a transparent and more affordable pricing model, reducing surprise drug costs at the pharmacy pick-up counter.
Abarca, said Blue Shield, will pay prescription drug claims quickly and accurately while continuing to evolve its technology platform, Darwin, to support new payment models. Prime Therapeutics will work with Blue Shield to negotiate savings with drug manufacturers to move toward a value-based model that aligns drug prices to patient efficacy and health outcomes.
Finally, CVS Caremark will provide specialty pharmacy services for members with complex conditions, including education and high-touch patient support.
Pharmacy Care Reimagined is part of the ongoing Health Reimagined strategy promoted by Blue Shield California.
THE LARGER TREND
GoodRx data published in 2022 showed that prescription drug costs have increased 2.5% since the beginning of the COVID-19 pandemic.
The price of prescription medications has increased at a far faster rate than inflation over the past several years. Since 2014, all goods and services have increased in price by 19%, while prescription drugs have increased in price by 35%. Prescription drug prices have also outpaced wages, gas, food, tuition, transportation, telephone and internet services, personal care, and new and used cars prices.
ON THE RECORD
"Amazon Pharmacy is thrilled to join Blue Shield of California in their effort to help members get the medications they need, when they need them, at a price they can afford," said John Love, vice president of Amazon Pharmacy. "With the help of Amazon's upfront pricing, on-time delivery, and round-the-clock access to clinical care, we can provide a customer-centric pharmacy experience that supports better health outcomes."
"Our company was built on a commitment to deliver transparent and affordable prescription drugs to everyone, and we are excited to collaborate with Blue Shield of California to change this part of the healthcare system in such an impactful and meaningful way," said Alex Oshmyansky, founder and CEO of Mark Cuban Cost Plus Drug Company. "We hope others will follow in the effort to fix this convoluted and inefficient prescription drug supply chain."
Twitter: @JELagasse
Email the writer: Jeff.Lagasse@himssmedia.com
