Ralph Moss Ltd.

Managed drug care

The Facts
Canada's health care system is changing. Due to rising costs, government health insurance coverages that were once taken for granted are now being reduced, and the responsibility for many of these health care benefits is being shifted to the private sector. Now, more than ever, Canadians are depending on their employee benefit programs.

The expense of maintaining these benefits is also escalating. The cost of prescription drugs is now the fastest rising component of an employee benefit plan. An aging work force and the introduction of new, more expensive medications contribute to this continuous escalation. Containing these rising costs is key to maintaining the quality of your drug plan.

Formulary

An important component in achieving this goal is the Managed Drug Care Formulary. A formulary is a comprehensive list of drugs chosen because they are both medically and cost effective. Typically, not all prescription drugs are covered under a formulary. Drugs such as smoking cessation or fertility prescriptions are often excluded. Convenience drugs such as capsules, patches and sustained release drugs might also be left off a formulary. In addition, many formularies now include mandatory generic substitution.

Drug Formularies are not new to Canada. In fact, they have a proven track record of being cost effective in Canadian hospitals and other medical facilities. Provincial Drug Formularies vary by province, and doctors working within each province are familiar with those Formularies. Most insurers formularies are reviewed every three months. New drugs will be considered for inclusion if they have therapeutic value and are cost-effective. Some expensive drugs may drop off a formulary if a therapeutically better drug or a less-expensive generic equivalent becomes available.

Generic Substitution
A generic drug is an exact chemical copy of a brand-name drug, and is often significantly less expensive. In many cases, a generic equivalent drug can be prescribed instead of the more expensive brand-name drug. Ask your doctor when prescribing, or your pharmacist when filling a prescription, if there is a generic substitute available.

Generic Formularies
If your pay-direct drug plan is based on a generic formulary, reimbursement is always based on the cost of the lowest-priced generic equivalent. If a generic equivalent is not available for the drug your doctor has prescribed, the full ingredient cost of the brand-name drug (less any deductible or coinsurance) will be covered. If there is a generic equivalent available but you want the brand-name drug anyway, it will be covered but only up to the amount that would have been charged for the lowest-cost generic drug.

Shopping "Smart"
There are two components to drug prices: ingredient costs and dispensing fees.

The ingredient cost is the cost the pharmacist pays for the drug plus a mark up added by the pharmacist. The ingredient cost of new drugs is often much higher than that of drugs which have been on the market for some time. Newer drugs may not necessarily be therapeutically better than a drug marketed earlier .Sometimes new drugs are just repackaged for convenience, such as patches, sustained release drugs, or capsules rather than tablets. These convenience drugs usually come at a higher price. All of these factors result in higher costs to your benefit plan.

The pharmacist also charges an additional fee for the time and effort required to fill a prescription. These dispensing fees can vary greatly from one pharmacy to another.

You can help keep the costs down by buying less expensive drugs and shopping at a pharmacy that charges a lower dispensing fee.

Drug Utilization Reviews
Prescription medications, like any drugs, have the potential to be harmful if used inappropriately. Taking a drug at the wrong time or circumstances, or in combination with other drugs can be dangerous. As well, the therapeutic value of a drug can be reduced if the drug, dosage or duration of therapy is incorrect. It is estimated that 50% of prescription drug users do not take their medication according to their doctor's and pharmacist's directions. This non-compliance can result in prescriptions being repeated unnecessarily, which translates into higher drug-plan costs.
Drug Utilization Reviews analyze prescription drug use, prescribing patterns, as well as patient drug usage. Drug Utilization Reviews are designed to ensure quality of care and to enhance the cost-containment features of a drug benefit plan. Concurrent Reviews identify potential problems prior to a prescription being filled. Under your pay-direct drug plan, your pharmacist will be warned of the following potential problems:

drug allergy: If you have informed your pharmacist of a drug allergy, every time you have a prescription filled, the potential for an allergic reaction will be monitored.
dosage amount: Does the daily dosage amount fall within the recommended limits?
therapy duration: is the prescribed duration of therapy longer or shorter than the recommended guidelines?
age precaution: Some drugs might be harmful to infants, children, or elderly patients.
gender conflict: Some drugs are gender-specific.
disease interaction: is this drug recommended for a patient with your disease or illness? (i.e. aspirin is not recommended for someone with ulcers)
drug interaction: There is a potential for interaction between this drug and another drug you are taking.
duplicate therapy: There is a potential for interaction or overdose when two or more drugs are being taken for the same condition.
duplicate drug: There is a potential for overdose if you are taking a brand-name drug and a generic equivalent at the same time.
pregnancy concern: you will be alerted to the possible harmful effects to a pregnancy.

These warnings will be made to your pharmacist at the time of adjudication when your prescription is being filled at a participating pharmacy. Your pharmacist will counsel you, or consult your doctor as required.

Disease and Lifestyle Management
If you have a chronic disease, managing that disease is important to your health.Good management will almost always result in lower medical costs to you, your drug plan and the Canadian health care system. It is important to follow the advice given by your doctor, pharmacist and other care professionals.

Managing your lifestyle can also result in better health and thus lower medical costs. If you smoke, quit. Eat healthy foods in the right amounts, get plenty of exercise, and if you drink alcohol, drink in moderation. The way you live your life now may affect the quality of the life you live in the years to come. It's up to you.

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