As much as professionals and consumers alike complain about the state of modern health insurance, they probably don’t remember how it operated during the late 1970s and early 1980s. It was a time when most health plans offered minimal, if any, coverage for prescription medications.
Consumers and providers also take for granted that they can have prescriptions filled at a local pharmacy almost immediately. Not so long ago, patients would have been required to pay out of pocket and submit receipts for reimbursement. Compared with current prescription management, in-office physician visits, in-patient hospital stays, and lab procedures all still take weeks—if not months—to process and reconcile.
According to Matt Gibbs, president of commercial and managed markets at EnvisionRx, the public can thank pharmacy benefit managers (PBMs) for such improvements. Yet, as drug prices continue to increase, many healthcare entities are seeking ways to better control costs. In pursuit of that goal, several PBMs and health plans have either merged, or are in the process of merging, as a new way to manage costs and to improve care with medical and pharmaceutical oversight.
“There has been a tremendous alignment of health plans and ownership relationships with PBMs,” Gibbs says. “As the plans attempt to leverage the economies of scale that come with having control over the entire patient care continuum, the results may not be optimal for all insurers or all patients.”
At its most basic level, the situation can result in a regional insurer, for example, paying a PBM that’s owned by a national competitor—a subtle but distinct conflict of interest. Furthermore, as part of their efforts to consolidate operations, larger PBMs may also only offer aggressive financial agreements with little room to customize services to a health plan’s own strategic plan.
EnvisionRx, on the other hand, is independent of any particular health plan, and therefore, an ideal partner for smaller, regional, or government-sponsored health plans. The PBM’s nimble nature allows it to offer options to health plans that might want a fully outsourced PBM solution, full insourcing support, or pharmacy benefit services on an à la carte basis. This flexibility enables health plans to self-manage benefits as much as they want—from formulary design or clinical reviews to pharmacy adjudication or medication therapy management, among others.
“We constantly anticipate evolving conditions with road maps to minimize risk and optimize clients’ operations.”
The PBM also offers flexible financial arrangements, such as a pass-through pricing model, that utilizes an administrative fee instead of the traditional spread model. With pass-through, all transactions, rebates, and savings benefit the payer because the company’s revenue stream is based exclusively on these administrative fees.
“We can provide our clients with solid financial deals, whether using our pass-through pricing model, traditional pricing, or a combination of both,” Gibbs says. “We’re adaptable and creative enough that we’re able to see the upside beyond the spreadsheet.”
In addition to adapting to a health plan’s strategies, challenges, and existing strengths, EnvisionRx works as a consultant to address changing market conditions and business developments. The company’s expertise in nonessential drug management can also help create savings by avoiding newly labeled medications that are simply combinations of existing over-the-counter products in prescription strengths. Gibbs says their high costs and associated rebates make these products very lucrative for some PBMs—often at the expense of health plan members.
“We don’t wait for new regulations, compliance requirements, or any of the many other ongoing changes in the pharmacy environment,” Gibbs says. “We constantly anticipate evolving conditions with road maps to minimize risk and optimize clients’ operations.”
For example, Virginia Premier Health Plan (VPHP), a regional Medicaid plan, was able to save more than $40 million with EnvisionRx as its PBM. These savings came as a result of pricing transparency, regular improvements to retail rates and rebates, as well as efficiencies such as a compounding approach for a hyperinflated drug, reporting analytics to detect high-risk pregnancies, and other programs to help the insurer better care for VPHP’s many low-income Medicaid members.
Gibbs adds that the transparent nature of EnvisionRx’s relationships with clients helps streamline discussions about evolving challenges and the benefits they can expect from strategic changes.
A former pharmacist who has worked in the industry for more than twenty years, Gibbs remains passionate about the work that he does at the company. “I could still be behind the counter dispensing medications, but at most I would be impacting a couple of hundred patients in a day,” he says. “The work we do here can affect thousands, often in ways that get lost in the process of prescription adjudication or negotiating rebates.”
Statistics support his assertion. Through its specialty pharmacy and medication management, EnvisionRx has posted impressive successes working with multiple sclerosis patients: adherence rates are at 92 percent, nearly twenty points above the industry average; the ninety-day discontinuation rate for those patients is 4 percent, up to 50 percent better than industry benchmarks; Hepatitis-C patients have shown a 98 percent treatment completion rate, compared with the industry standard of 88 percent.
Achieving those kinds of results and the ability to think like a health plan help set EnvisionRx apart from its competitors. “Health plans need to find PBM partners that can assume a ‘fully insured mentality’ so they can align strategies and solutions,” Gibbs says. “Then you can achieve outcomes that go beyond the bottom line. You are supporting a noble cause—transparency that supports access to the right medications and optimal patient outcomes. It’s what keeps me here.”