A fierce battle is being waged between retail pharmacists and mail-order companies over where people should be able to fill their long-term prescriptions.
Community pharmacists in New York are lobbying state lawmakers to pass legislation that would prevent health plans from requiring patients taking medications for chronic ailments to fill their prescriptions through the mail.
While some plans had shifted to mail delivery long ago because it was often cheaper for both employers and consumers, drugstores have been offering more competitive prices and pushing lawmakers to level the playing field by ensuring that people can still visit their local pharmacy for their drugs.
The proposed legislation, which was introduced in both state chambers in late February, would ban mandatory mail-order programs.
It would also forbid plans from demanding that people pay more for drugs if they buy them at the drugstore. “What we are asking is to make mail order an option, not mandatory,” said Craig M. Burridge, the executive director of the Pharmacists Society of the State of New York, whose members traveled to Albany on Wednesday to plead their case. “We are not opposed to mail order as a convenience to the patients. But right now, they don’t have a choice.”
Pennsylvania is considering similar legislation. The federal Medicare program already requires drug benefit plans to allow members the option of filling their prescriptions at the drugstore.
In making their argument, the pharmacists say some people, particularly the elderly who are taking multiple medications, benefit from going into a store and having a pharmacist oversee their prescriptions. They say many customers prefer being able to shop at places where they have longtime relationships with pharmacists.
The large companies that manage prescription drug programs, known as pharmacy benefit managers, say mail order is attractive because it is less expensive and more convenient.
“There’s going to be use of more home delivery, not less,” said Mark Merritt, the president of the Pharmaceutical Care Management Association, which represents the pharmacy benefit managers. “It saves money and is pretty popular with consumers.” He says employers choose mail-order programs because they believe them to be a better alternative, and the legislature should not take away their choice of plans.
But as the business of filling prescriptions also shifts from expensive branded pharmaceuticals to much cheaper generic alternatives, retail pharmacists, particularly large chains like Walgreen’s, are having much more success in persuading employers and health plans to allow people the choice of using drugstores for their medications for chronic ailments.
To increase sales at their stores, “retail pharmacies can offer and compete with mail order” by being willing to make less profit on the prescriptions they fill, said Adam J. Fein, an industry consultant in Philadelphia. “They are essentially trying to offer these products at mail-order pricing,” he said.
The decision by Wal-Mart several years ago to offer generic drugs for only $4 and the move by retailers to compete aggressively on price has damped the enthusiasm for mail order as the least expensive option, Mr. Fein said. Medicare’s insistence on including retail drugstores as an option has also helped slow the growth in prescriptions being filled by mail-order pharmacies, which he said lost market share in 2009.
Mr. Fein also points to Walgreen’s new marketing campaign, promoting its ability to fill prescriptions for the 90 days, the same as mail order. Walgreens, which claims many customers do not know their plans allow them to get three months’ worth of medicine at a drugstore, says it filled nearly 700,000 more 90-day prescriptions in January than it did at the same time last year.
Some benefit managers say they are now less convinced that mail is always better than retail, even in trying to save money. “I don’t know if mail service is a vastly superior cost containment tool today,” said David R. Kwasny, the president of Restat, an independent pharmacy benefit manager that does not have a mail delivery service. He says employers and insurers can instead try to steer patients to certain retail pharmacists, including independent stores, that are willing to compete on price.
But he also emphasized the personal touch of a retail pharmacist. “We feel there’s a lot of value and underutilization behind the pharmacy counter,” he said.
Take the case of an elderly patient who came into Family Medical Pharmacy, an independent drugstore in Williamsville, N.Y., near Buffalo. The patient had run out of Aricept, to treat dementia. She had already been to a chain drugstore where the pharmacists told her they could not help because she had mandatory mail-order prescriptions. Dennis C. Galluzzo, a pharmacist who is the co-owner of Family Medical Pharmacy, said he called her plan to try to get permission to refill her prescription.
“I relentlessly stayed on the phone for hours until we finally get it resolved and had to get an override from two supervisors,” he said. Only after he threatened to send the woman to a hospital to get the medication did the plan give the drugstore permission to fill her prescription, he said.
For their part, the prescription benefit managers say mail-order programs are better able to convert a patient to a less expensive generic drug, and that the plans they offer are better equipped to oversee a patient’s prescriptions.
Because these companies have invested in sophisticated computer systems to monitor all prescriptions, they argue they can intervene when someone is taking drugs that interact. If a patient has a particular question and needs privacy, they can simply telephone one of the plan’s pharmacists. In a drugstore, someone may feel rushed or uneasy about asking a question. “It’s just not an optimal environment,” said Timothy C. Wentworth, a senior executive at Medco Health Solutions, a large pharmacy benefit manager.
Some companies, however, are trying to develop programs that provide more flexibility. CVS Caremark, for example, has made use of its CVS retail drugstore chain to offer a program called maintenance choice, where people can go to one of their stores or use mail order to fill a long-term prescription. Express Scripts says it has developed a program that allows customers to choose whether to use mail order for all or some of their medications, and many people decide they would rather have their drugs delivered.
And while mandatory programs are still relatively rare, consultants say employers are increasingly likely to use financial incentives to try to steer workers to the least expensive options. In some cases, plans may have programs where customers pay less when they go to a limited network of retail pharmacists that are willing to offer less expensive prices or they may ask customers to pay more when they go to the drugstore.
Edward A. Kaplan, a benefits consultant with the Segal Company, recalls a recent client that instituted a co-payment when any of its employees used a retail pharmacist to fill a long-term prescription. Many of the employees happily paid for the privilege. “They didn’t vote with their wallets,” he said.
