Restat Sponsored Paper Shows Path to Annual Employer Savings of Up to 13 Percent in Pharmacy Benefit and Prescription Drug Services

Independent study confirms potential benefits of Restat’s Align – a cost-plus, fee-for-service pharmacy benefit strategy

MILWAUKEE--(BUSINESS WIRE)-- Employers adopting an innovative pharmacy benefit management (PBM) model that tears a page out of the preferred provider organization (PPO) playbook could lead to potential cost savings of up to 13 percent in annual prescription drug costs. Those were the findings in a recently published study released by Restat, the country’s largest independent pharmacy benefit manager (PBM), whose new Align program mirrors the strategy highlighted in the study. The study can be found at align.restat.com.

According to Restat president David Kwasny, the study findings demonstrate the science, transparency and potential impact of Restat’s new Align model – a strategic approach to pharmacy benefit design that reduces cost and complexity by replacing the traditional pricing methodology based upon AWP (average wholesale price) with a simple cost-plus, fee-for-service pricing.

“Employers are under more and more pressure to keep their heads above water as they confront the realities of today’s challenging healthcare environment,” said Kwasny.“Our goal is to liberate the prescription drug marketplace and cut the fat out of a system that has become more uncertain by the day. We believe Align does just that.”

Kwasny added that Restat’s own findings show that “if everyone in the U.S. were covered by Align, $30 billion of healthcare cost could be cut from the U.S. healthcare system.It’s healthcare reform without legislation and a big bureaucracy.”

“This is a real game changer,” said Kwasny.“Restat is on a mission to make it easier for self-insured employers to manage their healthcare costs and prescription drug plans without relinquishing quality healthcare benefits.”

The premise behind Align is relatively straightforward, but the results could be considerable, he added. Employers adopting the Align strategy have access to a network of more than 20,000 pharmacies that have lowered drug costs and reduced dispensing fees to be included as an employer’s favored pharmacy.

In addition to securing lower drug pricing, Kwasny said Restat’s no-ownership ties to drug manufacturers or distribution channels mean complete transparency and neutrality to the employer’s benefit.Through Align, Restat charges a flat administrative fee for drug administration services.Additionally, with Align, Restat collects no revenue from manufacturer rebates or ‘spread’ – the difference between the price the pharmacy collects from the PBM and the price the PBM charges employers, a common feature of traditional PBM contracts.

Kwasny also said Align could be tailored to the specific goals of an employer and its employees to focus on the concerns they see as primary – lower costs or more comprehensive benefits.Additional savings could be obtained by creating pharmacy benefit plans that add incentives to increase the utilization of generic drugs, he said.

In the end, the research that Milliman conducted confirmed Restat findings that Align could bring a company with 5,000-6,500 employees a cost savings of up to $2 million annually.

The white paper, “The Value of Alternative Pharmacy Networks and Pass-Through Pricing,” was researched and written by the internationally recognized consulting firm of Milliman, Inc., and outlines for the first time actuarial estimates of prescription drugs’ retail cost components.The findings did not relate to Align specifically, but help explain why some pharmacies and PBMs could offer lower prices on prescription drugs and how an employer could obtain significantly lower costs by using preferred pharmacies with pricing that goes directly to the network member.

About Restat:A member of the Dohmen family of companies, Restat simplifies the purchase and use of healthcare services through independent health benefits management. As the largest independent PBM, Restat has no ownership ties to drug manufacturers or distribution channels, making it uniquely positioned to provide customers with unbiased benefit management solutions. Today, more than 4,200 companies, ranging in size from the Fortune 50 to small managed care organizations rely on Restat to manage the prescription benefit for more than 12.2 million people nationwide. To learn more, visit www.restat.com or call 800.926.5858.

RestatJohn GardnerPh: (414) 861-9458
jgardner@zeppos.com

Source: Restat