Don't Take the Pill: 3 Ways You Can Reduce Your Drug Costs by 50% or More! [WEBINAR]

And I will be taking, keeping an eye on the chat box. So if somebody has a question, go ahead, type it in and then we'll get, we'll make sure we get those answered as we move along in the webinar. So let's level set. Let's start with why health insurance has been such a problem for so many employers for so long. Right now there are three challenges that I see every employer facing. And for those who have been on previous webinars, you probably have seen some of this already. But the first challenge everybody faces right now is this thing called the medical loss ratio rule. You know, this is a rule that was put back in place, put back into law back in 2010 when the Affordable Care act came out. And essentially what the government was trying to do was limit carrier revenue. They thought, hey, if we require the insurance companies to spend a certain percentage of every dollar they take in on claims, we're going to cap their revenue. Here was the problem. They told insurance companies, for every dollar you bring in, you have to spend at least 80, 85 cents, depending on the state you're in on claims. If you spend anything less than that, you have to give money back to your clients. And some of you on the webinar may remember getting medical loss rebate checks back in the day, but we don't get those anymore. And there's a reason why carriers have lost interest in helping you save money on your claims. Because the larger the claims go, the higher they go, the less likely they're going to have to give money back. And we can verify this if you look at the stock prices, the performance of the carriers today, those stock prices of Blue Cross, United and Cigna you're looking at were the stock prices on the day the Affordable Care act came out as of close yesterday. That's where they stand, they stood, guys. Insurance companies are doing really well over the past eight, nine years of the Affordable Care Act. So their performance continues to accelerate and grow while your bottom line continues to get eaten away at with health insurance costs. The second challenge is the healthcare system itself. This graph you're looking at right here has a lot going on. But what I want you to focus on is this is actual data of a knee replacement in Denver, Colorado. And what's interesting is when you look at the red bars on the chart, that is the price that each one of those facilities charges on average to replace a knee. The problem, though, is that squiggly line that looks like a heartbeat. That's the quality and the outcomes coming out of that facility. And what makes healthcare so interesting is it's not like buying a car or buying a tv. Higher quality, higher price doesn't always mean higher quality. In fact, some of the most efficient facilities in America charge some of the lowest prices out there. So this is a challenge because your employees, when they access the healthcare system, don't see this information. Which leads to your third challenge. And it's probably the biggest challenge you face today. And that's this right here. This medical ID card you hand out each and every year is now become nothing more than an unlimited company credit card to your employees. Because as long as they stay in the network of doctors and hospitals you're giving them, they can go wherever they want and they can spend whatever they want. So we have to fix this. How do we start fixing this? And I truly believe the fix is when we stop buying insurance and we start managing risk. So what do I mean when I say managing risk? Well, there's three areas of risk every employer has to start managing effectively if they want to start building better health plans for less money. First area is. I'm going to go back to that slide. First area of risk is financing risk. You have to think about how you're financing the health plan today. Some of you on the call might be fully insured. Some of you may already be self funded or in a captive arrangement. But the farther down you can go on this spectrum, the more control you are going to have with your claims, and the more control you have with your claims, the better ability you are going to have to control, and if not, reduce your health insurance cost. So the strategies we're here to talk about today, specifically with pharmacy, have a big impact on whether or not you have already taken those steps down this financing spectrum. The second area of risk is catastrophic risk.

If you want to have a chance to control your health insurance cost, these are the two most important words you need to recognize, and that is size and frequency. You have to focus on the size and frequency of the medical and pharmacy claims inside your health insurance plan. And today we're going to show you, we're going to talk specifically about focusing on the size of the prescription drug claims inside your health plan. And the third area of lit risk is health care purchasing risk. What do I mean by health care purchasing risk? I mean we have to start building the health insurance plans better. If you look at this chart right here, most health insurance plans today are built from left to right, meaning we pick the insurance company. We then ask the insurance company to manage those Four buckets of healthcare spend, inpatient cost, outpatient cost, prescription drug cost and primary care cost. The problem with that right now is our only strategies using this model to control our cost have been to shop insurance companies every year, increase the deductibles and out of pocket limits, or just ask employees to pay more. And that's not working anymore. So the fixed guys is when you start building the health plan right to left. Let's focus on our employees. Let's figure out how they're utilizing the healthcare system and put strategies in place to reduce the size and frequency of claims in those four boxes. And, and then let's go partner with the right insurance carrier, the right third party administrator to help us control, if not reduce those claims. And that's why I'm excited for this webinar today guys, because we are going to focus on one of those boxes today, prescription drugs. It is the fastest growing cost you have in your health plan today. And this is exactly why I wanted Zach Jones to join us. So Zach, I'm going to bring you on if you want to say hi to everybody, hello.

Hopefully everyone can hear me.

And then Zach, I'm going to give you control here of the.

PowerPoint from this point. But what we're going to do guys is I've got a set of questions I want to ask Zach and we're going to walk through a little interview here so you can get a better feel for what is going on in the pharmacy world today, what you can do about it to fix the cost epidemic we have inside prescription drugs today. And what are those next steps you could take if you are truly interested in finding out what you and your organization, your health plan can do to reduce the impact prescription drugs are having on your health insurance plan today. So with that being said, Zach, I'm going to ask you the first question. Let's level set right now when it comes to prescription drugs and mainly level funded self funded health plans, what is a pharmacy benefit manager and what is its role inside the administration of a health insurance plan?

Yeah, so great, you know, great question, good way to kind of start it off. So a pharmacy benefit manager, or a PBM for short, simply was supposed to be an aggregator of prescription drug claims. And then as it evolved, it evolved into where they started negotiating directly with the drug manufacturers to come up with, you know, discounted pricing that they could deliver to the employer market and then again still aggregate claims.

Awesome. Awesome. So what are some of the, you know, as we know, the pharmacy benefit management world or PBM as you said for short, is a mysterious one. And for those folks on the call who are self funded or in a captive today, you may understand that what are some of the unknown truths about the PBM world? Because after all, aren't they supposed to help companies save money?

Not necessarily. And so I think one of the big things or the misconceptions are is that.

A PBM is really trying to help groups save money. And so if you look out there, there's hundreds and hundreds of PBMs that are in the marketplace, but there's three PBMs that represent a large portion of employers. And so if you can see on the screen there, 76% of the market is kind of owned by Express Scripts, cvs, Caremark and Optum. And one of the things that I think a lot of people forget is that all three of those entities are Fortune 500 companies, meaning that they trade on the stock exchanges and they have a fiduciary responsibility to raise their share price.

When you have that component there, you're going to have some misaligned interest in the fact that they're going to make sure they're going to do everything they possibly can for the people who own their stock to make sure that that stock price goes up. And doesn't take a rocket scientist to figure out that for a stock price to go up, earnings have to go up. And so whatever it is that you sell, in this case prescription drugs, you need to sell more of.

Awesome. Awesome. Now, Zach, share some examples with us of how that's the PBM world. That's really the foundation of where cost and access to medications are being driven. Give us some examples of how some of the medications that some of our attendees are seeing on their drug plan are starting to be repackaged.

And maybe resold in different formats, which are ultimately having a huge impact on the bottom lines of the attend on the webinar.

Yeah, so not to get too, too into the weeds, but one of the things that you have with your prescription drugs is called the formulary list, which is very simply just a list of medications that your health plan covers. And with some of these public entities, they're the ones that are actually dictating which medications are on the formulary or which ones aren't. And unfortunately a lot of times they build their formularies based on what medications or what drug manufacturers are going to give them bigger rebates. And so really good examples are, and this is kind of funny because I get to talk to employers and folks like Andy pretty Much all across the country on a daily basis. And we talk about these two medications that are on the screen here, and I'll touch on them in a second and they'll say, oh, no, we know about those. We know about those. And then yet every day I see data of what employers are spending on certain medications, and every day I see these medications on their top 25 list, which means people really don't know what they don't know. The example that you can see here is the medication in the middle is called Duexis. It's basically a combination of Advil and Pepcid. And I think if you go to CVS right now, you could probably buy those two medications for under $20. And basically what it is is a combination drug in which it costs $2,300 a month. Typically, the member is not paying that much out of pocket, but your health plan is taking brunt of it. And you can see Vomobo is a really good example too. It's a leave and Nexium combined. And what happens is that.

You don't have doctors that know what the cost of medications are. They're talked to by the drug manufacturers. And so they just try to treat their patients. And so based on the symptoms, they'll make recommendations. So a lot of times you'll have these medications in which the doctor doesn't know what it costs, the member doesn't have a significant cost share, and the brunt of it's put on the health plan, and that's what rises costs. And so here's another example. So Hep C is something that can be cured by some of these, you know, some of these medications on the screen. But what you have, though, is a lot of these PBMs, they don't have prior authorization for these Hep C drugs, which Arvoni costs, you know, I think it's like over $90,000 a year for somebody to be. Somebody to be treated. And what you have to understand is, is that, you know, based on different symptoms, you may or may not need to be taking that medication. There may be other options before you actually go on something this expensive. Yet the prior authorization is waived. So it means if you have Hep C, the doctor prescribed the medication, the person doesn't have to go through any type of step therapy or clinical approval. They can just go get the medication, start the process. And now again, your health plan is under the situation where, you know, they're paying a big, big dollar amount for a very expensive medication.

That's an awesome segue. Zach too, because you may. You talked about the formulary list. You know, a lot of the attendees on the webinar and a lot of employers out there today are still getting told or still being told that the best way to control cost on your prescription drugs is the stuff we've been hearing about for years. Tweak your co pays or change the formulary list or go to a forced generic step therapy program. Do you have any insight as to why these don't actually help you save money?

Well, again, you have to just go back to the aligned interest, like where do they make more money? Is their contract and the way you're contracted with your pbm, are they actually putting themselves in a situation where they make more money on a higher cost drug? And so we'll talk, maybe you can touch on it a little bit. There's some entities from in the PBM world where they only get paid a per script fee. So they're not financially incentive incentivized to source a higher cost drug over a lower cost one. And as you look at some of these medications on the screen here, you don't really need to be able to read them or even pronounce them or know what they do. But what I can tell you is all of these medications, right, they actually have the same efficacy, which means that they treat the same symptom or the same illness. And so what you're seeing is you can see two medications. One, the first one $214 or you know, a medication that's $5. Which would you rather have your health plan paying for? And so if you have a PBM that has aligned interest, they're actually clinically going to look at these medications, say, hey, hold on a second, there's this other medication that has the same efficacy. Can we have a conversation with the doctor and try this one, try this one first. And so those are just examples that you can see. But these things are happening every day with every medication that's coming across your claim run. And it's very important to realize that you need somebody that's going to be sitting on your side of the table and is not interested in sourcing a $500 drug over a $28 one because they're going to make more money.

And Zach, that's a great question because we're going to, we're about to dive into the solutions. And so before we do, I think I need to ask a really important question. And with the data everybody sees on the screen right now, why is it important to have the Right. Pharmacy benefit manager in place.

Yeah. So great question. And this isn't just the pharmacy benefit manager. This is just anything. Right. I talk to people that make decisions on pretty large health plans across the country. And one of the things I don't think that they realize is that typically the people that procure the goods and services inside your health plan, they're not sitting on the same side of the table at you. And what I very simply mean is that they make more money when your claims go up. And so if you think about other things that you buy in your business, right, you. You tend to negotiate them in your favor. And if the vendor that you're working with or whoever you're buying your widgets from is not, not going to give you a clear price and be transparent and act in the best interest of what you're trying to accomplish, you're going to look to other folks. And so unfortunately, that doesn't happen with this line item. And so what you need to realize is, is that there are entities out there in all four of those boxes that Andy mentioned, priority of a health plan, that you can actually get those people sitting on your side of the table. And so if you get those people sitting on your side of the table, particularly from a PBM perspective, they're going to drive down the amount of money you spend on prescription drugs inside your health plan because they're not making any more money if they go with the higher cost ones over the lower cost.

Awesome. Awesome. Well, man.

We'Ve reached the point everybody wants to know now. Okay, let's start talking about how we actually can go about reducing the cost of prescription drugs inside the health plan. And guys, it goes back to what I said earlier in my part of the presentation about focusing on the size of your medical, of your pharmacy claims. Because if, if some of you out there are self funded, which I believe a lot of you are, you're looking today at drugs that can be 30, 50, 70, 80, $100,000 or more. And those are the drugs that are impacting your plan to a degree that you haven't seen before. So, Zach, let's dive into the fixes. Let's talk about the first opportunity of significant savings, international sourcing. Do you mind going into that for a little bit?

Yeah, no, for sure. So.

One of the programs that we facilitate at script sourcing, and I'll just kind of preface it and say we work on behalf of our clients kind of as an overlay to their health plan in which we're monitoring prescription drugs data and Then we're making available, you know, a lot of these high dollar medications to plan participants at no cost. And the reason is, is because our acquisition cost is significantly less. And so the first one is we have access to a lot of these pharmacies through these other tier one countries. And you can see the flags on the screen there. So Canada, the United Kingdom, New Zealand and Australia. What we do is these are brick and mortar pharmacies in these other countries. They serve their own citizens, they have a pharmacist that, you know, has the same FDA requirements are higher than we do. And so what we're able to do is provide a mail order program in which we can have these medications shipped directly to a member.

Right to their doorstep. And it comes from the same manufacturer that manufactures the medication that they purchased here domestically. It's just that the net acquisition cost in those countries is significantly less. And so we have a lot of success with that program. And we have lots of folks that have been doing this for significantly a long period of time and they've seen their drug spend on the brand name and specialties go down a lot.

And so Zach, I want to focus on the part of this slide says two decades of experience, some on the webinar may have been told in the past that it's international sourcing, it's illegal. And so can you elaborate on that a little bit? Maybe clear up some of the misperceptions that are out there?

Yeah. So first things first is that if you actually kind of look at the way the law is written, it's a very much a gray area. There's been a non enforcement policy in Washington in regards to individuals importing up to a 90 day supply of FDA approved medications for over two decades. No one's ever gotten even their hand slapped. And frankly, one of the things you have to look at is that from a government perspective, you know, everything that you read, both sides of the aisle kind of supports the fact that they're not really in a position to hammer. Well, you know, I would say Aunt Betty that lives in Buffalo going to see her sister in Toronto and getting some Advair. It's just not, it's just not in good taste. And the reality is they know that these medications are the same medications from the same manufacturer. It's just coming from a pharmacy that is crossing an imaginary line into the, into the United States.

Okay, awesome, awesome. Thanks for clearing that up. All right, let's talk about the second option, second opportunity to save. You know, we're talking significant dollars Here, manufacturer assistance programs, what are they? How can they help an employer save significant dollars? And how can an employer take advantage of a program like this?

Yeah, so one of the things that people don't realize is that Big Pharma actually gives away a significant amount of these high dollar medications through a matrix of charities, grants, foundations, patients assistance programs and the like. And so we have a team internally that knows how to navigate that matrix of opportunities. And to the effect that we're handling the specialty medications, or if you're working with some of these better PBMs out there, it gives you access where you can try to get some of these medications for free. And so we have a specialty medication review process in which the medication is clinically approved. Right. It's the correct dosage, the correct quantity and the correct medication. And then we do a financial review in which we see if we can tap any of these resources to get these medications from the manufacturer. And so I'll tell a very, very, very quick story. Like last week or two weeks ago, I got off the phone with a pretty large bank client that we have in the southeastern part of the country. Their HR person called me because they had a member that was on a medication called ibrance. It's about $140,000 for a year. We were able to get it directly from the manufacturer at no cost.

The CEO actually saw the invoice for the medication and immediately called HR and said, well, hey, how do they do this? And she explained it and she said, all right, we'll make sure that whatever information they need to work with any of our other members, they have it because this is a substantial amount of money in savings and we really like it. And so this is a good program that in most instances, most folks are not going to be able to have access to.

Awesome. So did I hear you right? $100,000 drug or $140,000 drug essentially for no money, both to the member and the employer.

Yep, correct. Yeah. And so again, the reason is, is that these medications are so high cost. And so from like a tax perspective for these big pharma companies, they need, they need to have, you know, these type of options available. And then there's these charities, grants and things like that that also exist. And so you need somebody that has the expertise to be able to navigate that, because there are some components. But yeah, you're right.

That's awesome, man. Massive opportunity. Alright, finally, let's talk about the third way an employer can drastically reduce prescription costs. Pharmacy tourism. Are employers, Zach. Are employers really Sending employees to other countries to get their medications.

Yeah, they are. So I'll explain kind of the way the program works, then I'll kind of give you some, some food for thought and you can, you can prove it yourself. And so to the effect that we have a high dollar medication and we can't get it from a manufacturer if we don't have a mail order solution, we'll send people to some of these destinations that you see on the screen here, Cayman Island, San Diego, for an employer sponsored mini vacation in which they go over the border to Mexico or in the Caymans and they see a doctor at a world renowned facility, they get the same exact medication that they're getting here from their regular pharmacy and they bring it back over the border, they bring it back home with them, and then the rest of the time is theirs to enjoy a little, a little vacation paid for by the employer. And the end result is that the employer ends up still saving a significant amount over what they normally would have paid. And so the food for thought is the state of Utah, their state health plan, they actually do this and have a program just like this for their state workers. And so if you Google Utah pharmacy tourism program, it comes right up on their state website. They actually pay members to go and get some of these medications over the border in Mexico. And you can kind of read about that. So it's not. While it's a little bit unusual and sometimes people think like, wow, this is a little outside of the box, yes it is, but it is happening. Employers are doing it. And we have what we call repeat offenders. Typically we have an employer, the first time they do it, they're a little skeptical. The person goes. And usually more than not, we have other people that actually partake upon these type of programs because they realize it works and the employer has financial success and the employee likes the experience.

That's awesome. Wow. So Zach, if I heard you right, you just kind of refresh and summarize, you know, the three things we just talked about, three solutions we just talked about, you know, if you're an organization sitting on this call right now, maybe, you know, maybe you're blue collar, maybe you have employees who are getting paid in the 12 to 20 dollars an hour range or even people making 45, 50 thousand dollars an hour. There are opportunities to provide some significant drug savings to both the health plan and the members that we're seeing. Some of your clients save 50 plus percent on those medications. Is that correct?

Yeah, no, for sure. I mean, we definitely have employers that end up, you know, they end up cutting their spend significantly, 30 to 50% within a year. And very simply, it's because they have or they've hired people that have aligned interests with what they're trying to do, which is spend less money on prescription drugs.

Yep. Awesome. Well, Zach, we got two minutes left. Let's finish up with this question. If somebody on this webinar wanted to take the next step, so they're sitting there, they know drugs are impacting their health plan, they want to take the next step, what would they have to do to see if this made financial sense for them?

Well, I think the first thing is, you know, they'd reach out to you, or they'd reach out to your team, see if they can get access to their prescription drug data, whether it just be a top 25 list or their actual claims data. And again, we don't need any type of patient information. We just need to know, like, hey, what are the medications, the dosage, the quantities, and what are you paying for? We can turn around a Savings analysis within 24 hours where you can see exactly, hey, some of these options that we just talked about, what the potential savings opportunities would be. And I encourage everybody to kind of take a look whether you decide that script sourcing something for you is. Is a different conversation. But to be able to kind of really see how bad or what you're overspending on really kind of makes sense, because it makes you sit down and think, okay, what can we do to try to get this back on our side of the table?

Awesome. Awesome. So, guys, if you're out there right now, you're on this webinar. I know a lot of you probably have your renewals coming up in the next couple months here in January 1st, and you're struggling with what prescription drugs are doing to your health plan. You're not alone. It's impacting every employer. But you have two choices. You can either keep doing what you've been doing and getting the same results you've been getting, or you can try something different. And that's why I wanted to bring Zach on here today, because what script sourcing is doing to help improve drug efficacy, helping to significantly reduce the impact of the cost on what drugs are having on our industry. Guys, this is how you start doing it. It's not about changing your formulary list. It's not about moving to a step therapy program or raising your CO pays you. It's about attacking the actual cost of the medication and why. What better way to do it than by significantly reducing the cost of your drug and then giving that drug to your employee for free. I don't know a better way to do that. So if there's interest out there, guys, don't hesitate. Reach out to me. Reach out to Zach. With that being said, do we have any questions? I don't see anything in the chat box right now, but if you have any questions about what you just saw, feel free to go, go ahead and type them in the chat box right now.

Zach, you must have done a good job, my man. We don't have any questions right now. So with that being said, guys, like I said, I wanted to keep it short and sweet and to the point. So we are at the half hour mark. Thank you for jumping on again. If your health insurance renewal is staring you right around the corner, it's time to do something different if you want to get different results, guys. So thank you for being on the webinar. Have a great afternoon and have a great rest of the week. Thanks, Zachary.