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What Does a Best-in-Class Pharmacy Plan Design Look Like?

Member taking notes during webinar

Pharmacy plan designs encompass everything from cost-sharing arrangements to formulary management to utilization review programs. When combined, they create a well-managed pharmacy plan that drives higher value outcomes for patients and plan sponsors.

Top Takeaways from the Best-in-Class Pharmacy Plan Design Recommendations Webinar

1. Formulary Exclusions Help Drive Lowest Net Costs

CVS Caremark (CVSC) formulary lists contain clinically appropriate and cost-effective medications. National CooperativeRx’s clinical team has identified opportunities to improve upon these and recommends plan exclusions to complement and supplement CVSC’s formularies. Examples include high-cost/low-value medications, medical foods, and medical devices, as well as others.

2. Better Consumers Can Result in Greater Savings

Plan members can access helpful information through digital tools such as or the CVSC mobile app. These tools show member-specific information where they can check their plan design, drug costs, and billing history. Generic alternatives to drugs and mail-order opportunities are also available, as well as the ability to identify annual savings based on user-directed changes. Encouraging plan members to register and utilize CVSC digital tools will help them become more educated consumers. It may also help improve medication adherence and lower overall health care costs for the plan and plan participants.

3. National CooperativeRx Clinical Programs Have Proven Cost-Containment

In 2021, specialty medications among National CooperativeRx membership accounted for 1.5% of claims, yet 48.5% of total pharmacy spend. Our specialty trend and spend are below the average of our industry. We attribute this to our proactive recommendations, adoption of our clinical programs by plan sponsors, and the ongoing vigilance of the PBM contract. Available clinical programs include high-dollar claims reviews, supplemental formulary management, pharmacy network oversight, and advanced utilization management. In 2023, we will continue to build upon these successes with specialty medication prior authorization and enhanced psoriasis management.

4. PrudentRx Plays a Valuable Role in Decreasing Coinsurance and Copay Amounts

PrudentRx is a third-party partner with CVSC that leverages copay card values, benefitting payers and members. Applicable specialty medications are set up with a fixed coinsurance of 30%, regardless of manufacturer funding available. PrudentRx is not a copay maximizer program; there are no variable copays on a drug-specific basis. Once a plan participant enrolls with PrudentRx their costs are $0. PrudentRx has proven it provides significant savings to our members. In Q1 of 2023, CVSC expects to have a PrudentRx offering for high deductible health plans.

Other Areas to Take into Consideration

*Non-Specialty Plan Design

Many plan sponsors focus their attention on reducing specialty trend and spend, and rightfully so. However, it’s important not to lose focus on managing non-specialty trend as a means to help manage and mitigate specialty. This includes analyzing coinsurance structures, formulary, dispense-as-written terms, maximizing generics, etc. Enhancing both non-specialty and specialty areas of plan design contributes to lowering overall trend. A sound plan design is key to driving favorable performance and outcomes.

*Adjusting to the Rise of Weight-Loss Therapies

Market surveillance and monitoring through claim reviews and keeping tabs on the pipeline continue to help us identify emerging trends. In 2021, a newer class of diabetes medications surpassed insulin as the top spend for the antidiabetics therapeutic class, contributing to an industry-wide increase in non-specialty trend. National CooperativeRx evaluates strategies and recommendations on an ongoing basis. This is based on data-driven decisions in response to industry dynamics. An area of current focus is products with approved indications for diabetes as well as weight loss. Possible solutions are being explored and considered with National CooperativeRx’s clinical team and CVSC.

*Upcoming Biosimilar Launches

In preparation for the upcoming launches of biosimilars, CVSC is focusing their formulary management on:

  •  Product quality and clinical efficacy
  •  Ensuring lowest net costs are inclusive of discounts and rebates
  •  Reliability of manufacturer product availability

*The Downsides of Alternative Funding

National CooperativeRx has spent a lot of time evaluating the alternative funding and procurement market space. Although eye-catching savings may be touted, there are many aspects for plan sponsors to consider and understand before contracting with one of these now numerous entities. This runs the gamut from non-needs-based funding to needs-based funding; the ethics of commercial payors taking advantage of charities and foundations meant for those in need; safety, clinical efficacy, and legality of international sourcing; savings methodologies, undisclosed costs, and more. Read our blog on assistance vendors for more details.

*The Positives of Rebates When You Have a Solid PBM Contract

Rebates have become a significant part of the overall price equation and an important part of PBM contracting to help achieve lowest net costs. National CooperativeRx provides broad and robust contract terms when it comes to the definition of rebates.

Our rebate distribution offsets costs, allowing plan sponsors and members to experience lowest-net-costs. In 2021, our master contract returned an average of 31% of gross costs to members due to our broad rebate definitions. Rebates can add tremendous value when they are 100% pass-through.

If you have further questions or would like to make plan changes, please contact your National CooperativeRx account representative.

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