Pharmacy Care Alliance provides $2.9 million in savings to Medicare beneficiaries

Jul 29 2004

The Pharmacy Care Alliance has announced that for the first seven weeks of its discount card program, Medicare beneficiaries saved an average of 40 percent on generic drugs and 23 percent on brand drugs when compared to retail pharmacy cash prices. Medicare beneficiaries in all U.S. states have used the Pharmacy Care Alliance card since June 1.

Based on an analysis of 192,000 thirty-day-equivalent prescription claims that were filled during the first seven weeks of the program, Pharmacy Care Alliance cardholders saved more than $2.9 million, excluding the $600 annual credit provided by the federal government to eligible low-income Medicare beneficiaries.

The Pharmacy Care Alliance conducted the analysis and is releasing the results in order to increase general public knowledge of the Medicare prescription discount card program. More than 43,000 different Medicare beneficiaries used their Pharmacy Care Alliance discount card during the period.

Pharmacy Care Alliance cardholders who received the $600 credit saved another $3.2 million. During the seven week period, about half of the Pharmacy Care Alliance's active cardholders received the $600 credit.

In the Pharmacy Care Alliance program, beneficiaries receiving the $600 credit paid only five or 10 percent of their prescription drug costs, depending on their income level, resulting in an average payment of $2.43 or $3.99, respectively, for their prescription drugs.

In addition, the Pharmacy Care Alliance announced that for cardholders who deplete their $600 credit, AstraZeneca, Johnson & Johnson Pharmaceutical Companies, Inc., Eli Lilly and Company, Merck and Novartis will make many prescription drugs free of charges from the manufacturer plus a nominal amount to cover dispensing, processing and other costs.

Beneficiaries who paid an enrollment fee for the Pharmacy Care Alliance discount card typically received savings greater than the enrollment fee value during the first seven weeks of the program. On average, beneficiaries who paid an enrollment fee for the card filled 4.5 prescriptions during the period, saving an average of $15.50 on each, for a total of nearly $70. The federal government pays the enrollment fee for beneficiaries receiving the $600 credit.

The Pharmacy Care Alliance analysis also identified ways Medicare beneficiaries could save even more money on their prescription drugs, specifically by increasing their use of generic drugs from the average 54 percent rate recorded during the period.

For example, in the gastrointestinal drug therapy class, only 4.8 percent of the prescriptions filled were for the generic proton pump inhibitor omeprazole.

“Medicare beneficiaries should consult with their physician to see if the less expensive generic would be just as effective for them. Physicians can help Medicare beneficiaries by prescribing a generic whenever clinically appropriate, said Mary Ann Wagner, president and consumer health adviser for the Pharmacy Care Alliance.”

Among Pharmacy Care Alliance cardholders who did not receive the $600 annual credit, the gastrointestinal drug therapy class ranked sixth in total spending. It ranked ninth for cardholders who received the credit. Drug classes related to cardiac and diabetic conditions ranked the highest for both cardholder groups.

Notably, the Pharmacy Care Alliance analysis found that the generic dispensing rate for its cardholders with the lowest income – those with the $600 annual credit and paying only 5 percent of the drug cost – was the highest at 60 percent. Pharmacy Care Alliance cardholders who were not eligible for the $600 annual credit recorded the lowest generic dispensing rate at 49 percent.

The Pharmacy Care Alliance analysis also revealed that the average age of its active cardholders was 74. Two-thirds of all active cardholders were women. The Pharmacy Care Alliance has received 160,000 applications for its Medicare approved discount card, of which 110,000 have been approved to date by the Centers for Medicare and Medicaid Services and are now enrolled in the Pharmacy Care Alliance program.

Medicare-approved drug discount cards are designed to help beneficiaries with prescription drug costs until the new federal prescription drug coverage – Medicare Part D – takes effect in January 2006.