A pilot program that put generic-drug dispensers in doctors’ offices to encourage them to prescribe generics instead of brand-name drugs has been a big success, saving nearly $2 million in anticipated drug costs, Blue Cross & Blue Shield of Rhode Island said last week.
The program, a partnership with MedVantx Generic Drug Delivery Network of San Diego, started with a handful of doctors in late 2005 and has grown since to involve more than 160 physicians in 35 locations, Blue Cross said.
The insurer recruits practices with multiple doctors, focusing on primary-care physicians, and MedVantx installs the vending machines at its expense, connecting the equipment to the doctors’ computer networks, if possible.
When a doctor wants to give a patient a sample of a generic drug, the machine dispenses a 30-day supply and logs the transaction; Blue Cross then pays for the drugs given to its subscribers, along with an administrative fee for MedVantx.
The idea is to provide an alternative to doctors’ biggest source of free prescription drugs: samples provided by pharmaceutical companies.
Such samples are popular with patients because they allow them to try a medication before having to pay for it. And for the drug companies, they’re a good investment because if the drug works well, a patient may go on to take it for months or years.
But precisely for that reason, the freebies can cost the health care system a lot in the long run. Daniel Curran, Blue Cross’ pharmacy manager, said the average cost for a 30-day supply of a generic drug is $25, but the average cost for a brand-name drug is $120.
Even for the patients themselves it’s a big difference, Curran noted:
A year’s worth of a generic drug at the average Blue Cross co-pay, $8, would be $96, whereas the co-pays for a brand-name drug average $24, for a total out-of-pocket cost of $288 a year.
Because prescription drug costs are among the main drivers of health care costs, Blue Cross has made promoting the use of generic drugs a priority.
The company encourages employers to use a three-tiered prescription drug benefit plan that favors generic drugs – now used by 65 percent of Rhode Island employers, Curran said – and every quarter, it sends doctors in its network a report on their prescribing patterns, highlighting further “opportunities for generic prescribing.”
The latter, combined with new generic-drug introductions (for the popular cholesterol drug Zocor, for example, and the anti-depressant Zoloft), has helped boost generic-drug prescribing.
But the MedVantx program accelerated the trend, Curran said: While during the pilot, the share of generic-drug prescriptions among all doctors grew from 54.5 to 58 percent, doctors in the pilot, who started out at 55.5 percent generic prescriptions, went up to 60 percent.
Every percentage-point increase in overall prescribing will save about
$1 million, Curran said, so the difference is significant. And based on what Blue Cross sees in its Medicare and Medicaid populations, the company believes the share of generic-drug prescriptions could be boosted more, he said, to 68 or 70 percent.
For comparison, UnitedHealthcare of New England spokeswoman Debora Spano said the share of prescriptions in the insurer’s Tier 1 – which includes some preferred brand-name drugs as well as generics, is in the “mid-50s.”
United, which unlike Blue Cross does its own pharmacy benefits management (through a subsidiary), reaches out to patients and doctors alike to let them know about “lower-cost medication alternatives,”
Spano said, and the insurer also encourages pill-splitting for certain drugs, if the doctor approves.
For physicians, all these factors seem to be coming together to change prescribing habits.
Dr. Al Puerini, of Family Health & Sports Medicine in Cranston, said when his practice started getting prescription-pattern reports, it was at about 49 percent generics. Now it’s up to about 65 percent.
Asked what has made the difference, he said both doctors and patients are very conscious of the cost savings from choosing generic drugs, and the introduction of new generics has helped as well. The MedVantx program also has made an impact, he said, because “you’ve got that machine staring you every day in the face.”
Dr. Stephen M. Scott, whose Atmed Primary Care practice in Johnston, was among the first to install a MedVantx dispenser, said it’s been “a beautiful thing. … I actually can’t imagine living without it at this point.”
Like Puerini, Scott said one of the greatest benefits of the program is that patients can sample a medication for free – a big plus with conditions where you might try one drug, see how well it works, then try another if it doesn’t.
Of course the pharmaceutical companies haven’t stopped bringing their own samples, and Scott said they “probably try harder now” to sell him on their drugs – “which is OK; they’re out there for information, and there are always new things coming out.”
To further reduce drug costs, Curran said, Blue Cross is looking at two additional strategies: providing vouchers so patients don’t have to pay the co-pay the first time they fill a generic prescription, and providing some coverage for over-the-counter alternatives to prescription drugs – say, Claritin for allergies, or Prilosec OTC or Zantac instead of Nexium.
Blue Cross also has its eye on changing state law to make it more difficult for patients to get brand-name drugs when there’s a generic equivalent. Currently, the law requires that if the patient asks for the brand-name drug, the pharmacist provide it; Curran said the insurer would like to mandate a doctor’s OK to dispense the more expensive drug, as is done in Massachusetts.
“We think the doctor should be making that decision,” he said.
