Drug Price Variability Among Medicare PDP Plan – Part 3: Generics By Pharmacy

Written by Dr. Thomas Barus

June 20, 2020

As we continue our analysis of Medicare Part D PDP pricing, this segment will analyze generic drug pricing from the Pharmacy perspective. Since generic drugs are typically reimbursed using MAC pricing, plans and PBMs sometimes work together to decide the MAC pricing for specific drugs (possibly to attract certain patients to their plans). In turn, pharmacies may see varying reimbursements for the same drug across different plans for the same dates of service. Yet, pharmacy acquisition price does not vary at the same pace as MAC pricing changes. Let’s have a look.

By Pharmacy

Pricing By Pharmacy by Cost Bin Across PDP Plans:

A Deeper Dive on Low Cost Generics:

 

All Plans for Each Pharmacy by Price Bin:

When looking at different pharmacies for all drugs and all plans in a given price bin, we can see variation.






Summary

In part 3 of our pricing series, we reviewed the pricing variations that exist between and within pharmacies. It is clear that variation in pricing exists for the same drug across pharmacies. This creates a heavy burden upon pharmacy buyers, pharmacy owners, and consumers. Pharmacies must carefully plan purchasing, forecast with sophistication, and take into account member profiles and plan benefits.  Consumers must carefully shop based on drug basket mix and pharmacies nearby. Pharmacy owners should take careful oversight of purchasing and implement business intelligence solutions for greater clarity on trend. In addition, it may be worth looking into drug min-max guidelines which payers must adhere to based marketplace supply and demand and acquisition costs.

We are only getting started! In part 4 of our series, we will be diving deeper into specific pricing variations. The analysis is in-process and expected July 2020.

In case you missed it, link to Part 2 – Medicare PDP Plan Pricing Analysis


If you are interested in further statistics or details, please contact info@barusconsulting.com

The Full Data Pricing File is available here for purchase: Full Data Pricing File

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