Unbeknownst to health plans, many PBMs are dispensing through their subsidiary pharmacies far more pills than needed, at great cost to the health plans. Thus, if your health plan is trying to contain its costs, you need to investigate your PBMs’ refill practices and end all excessive dispensing by your PBM’s refill pill mill.
Auto-fills & Dispensing Date Creep
Ask any of your employees, and you’ll probably learn many are swimming in unused pills that need never have been dispensed. “Pills – pills – and more pills,” they’ll likely exclaim. “I can’t fathom what I’m supposed to do with all these pills!”
Many PBM pharmacies automatically refill prescriptions without the beneficiary asking for the refill. As a result, many of your plan beneficiaries are probably getting refills when they don’t want or need them.
Moreover, many PBMs dispense a “second fill” to plan beneficiaries long before the beneficiaries have run out of pills from the initially dispensed prescription. Then, ignoring the excessive number of pills that the beneficiaries already have in hand, the PBMs dispense the “third fill” too early as well. As a result of this “dispensing date creep,” many plan beneficiaries receive far more drugs than they actually need.
Here’s how to fully understand the “dispensing date creep” problem:
If your employee is purchasing a 90 day supply of a maintenance medication from a mail order pharmacy, to obtain a year’s supply your employee needs to receive 4 prescriptions a year, plus 5 days from a fifth prescription (90 x 4 = 360 + 5 = 365). Or looking at a calendar: If your employee obtained his “first fill” on January 1st, given that certain months have slightly fewer or more than 30 days, your employee would need to receive his next “fill” on April 1st, his next “fills” a few days before July 1st and October 1st, and again on December 25th.
But suppose your PBM’s standard practice is to dispense each “fill” after 60% of the previous “fill” has likely been used. That would mean that your PBM would dispense “fills” every 54 days (90 x 60%). Or looking at a calendar: When your employee obtains his first prescription with two refills available, rather than receiving his “fills” on January 1st, April 1st and a few days before July 1st, he’d receive them on January 1st, February 23rd and April 18th. Note that at the time of the “second fill,” your employee will have 36 unused pills on hand from the previous prescription (90-54). And at the time of the “third fill,” he’ll have 73 excess pills from the two prescriptions previously dispensed!
Many PBMs are dispensing refills based on exactly the described 60% protocol. Many others are using a 70% protocol, which results for a single 90 day prescription in 108 excess pills per year! Even if your PBM is implementing an 80% protocol, your employee will still end up for each of his 90 day maintenance prescriptions with 72 excess pills per year!
As you can see, your PBM’s practice of dispensing refills too early – and then repeatedly refilling prescriptions based on the date that the last prescription was filled – results in “dispensing date creep.” Each prescription will arrive with more and more days to spare before your plan beneficiary actually needs the medication, and with your plan beneficiary obtaining an ever-greater number of excess pills.
Here’s a Chart that summarizes the annual impact of a PBM’s “dispensing date creep,” based on different refill practices for 90 day prescriptions that your PBM may be employing:
PBM’s Potential Dispensing Practices: % of Days After Previous Fill That Next Fill Occurs
Number of Pills That Have Been Used From Previous Fill
Number of Unused Pills From Previous Fill
Total Annual Surplus of Pills
60%
54 used
36
144 extra per year
70%
63 used
27
108 extra per year
80%
72 used
18
72 extra per year
Ending Your PBM’s Refill Pill Mill
Clearly, if your health plan wants to control its costs – and prevent waste – you need to ask your PBM how it’s refilling prescriptions, and assuming you discover your PBM is engaged in the practices described, you need to insist your PBM change its practices. And do so in writing, in a binding Benefit Change Form.
Note: If your PBM claims your PBM contract precludes you from altering its standard refill practices, you should make clear you’ll take your business elsewhere. Our contractual arrangement for the National Prescription Coverage Coalition prevents refill over-dispensing. Therefore, your health plan certainly has alternatives.
Assuming your PBM will allow you to change its practices, here’s what you should require your PBM to do:
First, tell your PBM you want it to stop automatic refills. Even the stodgy federal government has taken steps to require “refill consents” before refills can be dispensed to Medicare Part D beneficiaries.[1] Accordingly, there’s no reason why your health plan can’t end automatic refills too.
Second, in connection with 90 day mail prescriptions, require your PBM to transmit a “refill reminder” – via email, text, fax and/or robo-call – when 80% of the previously dispensed prescription has likely been used. Then, bar the PBM from dispensing any refill unless your plan beneficiary specifically requests it.
Third, tell your PBM that if a beneficiary requests a refill, the PBM can only dispense the next “fill” when 75% of a 30 day prescription – and 85% of a 90 day prescription – has presumably been used. That will limit potential waste, while still ensuring that every beneficiary receives the next “fill” with plenty of time to spare. For example, for a 90 day prescription, that will mean that the pharmacy will dispense the prescription on the 76th day (90 x 85%), and even if it takes 5 to 7 days for the prescription to arrive in the mail, the member will still get the prescription at least a week before it is needed.
Finally, tell your PBM that the time frame for the “third fill” should be based on the dispensing date of the “first fill” and not the “second fill.” That will prevent “dispensing date creep” and the dispensing of far more drugs than needed.
Unfortunately, many – if not most – PBMs have as their “standard” dispensing practices (i) the automatic refill of prescriptions, with (ii) each refill being dispensed far earlier than necessary, and (iii) the next refill being dispensed based on the previous refill’s too-early dispensing date (rather than the first “fill’s” dispensing date), resulting in “dispensing date creep.” You should do everything you can to stop all these practices!
After you implement new refill protocols, you should periodically check your claims data and make sure your PBM is adhering to your new protocols. The few audit firms that know how to investigate this issue have found that many PBMs violate plans’ written refill protocols, with the result that at least 1% to 4% of total drug costs represent over-dispensing. That’s a lot of waste, justifying a periodic refill audit, even for a relatively small plan.
The Aggregate Cost of Excess Dispensing
To appreciate the aggregate impact of drug over-dispensing, take a look at the federal government’s Drug Take-Back Program. During the first four years that the Program was in effect, people have brought back 4.823 million pounds – or 2,411 tons – of unused drugs.[2]
Although the weight of pills varies, if we assume that the average pill weight is 20 mg., every pound of returned pills represents approximately 22,679 pills. Using that rough calculation, during the Program’s first four years people turned in more than 109 billion unused pills on Drug Take-Back Days.
Health plans – like yours – paid for a large percentage of those unused pills – at great cost. In fact, no matter how you calculate the cost of approximately 109 billion unused pills, it represents tens of billions of dollarsof unused drugs. PBMs’ refill practices undoubtedly caused a significant portion of that waste.
Moreover, don’t forget that most people didn’t pay any attention to the government’s Drug Take-Back Program. Instead, they allowed their unused meds to accumulate in their medicine cabinets, or tossed them in the garbage, or flushed them down the toilet. Pity our land fill sites and our water supply, not to mention the poor fish.
In short, hills of unused pills are accumulating, polluting our rivers and aquifers, and costing your plan immense sums unnecessarily.
So as soon as you can do so, investigate your PBM’s refill practices, and change them by writing precise refill protocols. Then periodically use a knowledgeable auditor to run a “quick and dirty audit” and make sure your PBM is adhering to your written protocols. Or join an effective Coalition that will perform this work and make sure that your plan is continually protected.
Every PBM should be required to dispense refills wisely. There’s simply no excuse for the excessive dispensing of pills.
# # #
To read other Rx Drug Alerts, go to our drop-down Menu and click on Rx Alerts.
End Your PBM’s Refill Pill Mill
Unbeknownst to health plans, many PBMs are dispensing through their subsidiary pharmacies far more pills than needed, at great cost to the health plans. Thus, if your health plan is trying to contain its costs, you need to investigate your PBMs’ refill practices and end all excessive dispensing by your PBM’s refill pill mill.
Auto-fills & Dispensing Date Creep
Ask any of your employees, and you’ll
probably learn many are swimming in unused pills that need never have been dispensed. “Pills – pills – and more pills,” they’ll likely exclaim. “I can’t fathom what I’m supposed to do with all these pills!”
Many PBM pharmacies automatically refill prescriptions without the beneficiary asking for the refill. As a result, many of your plan beneficiaries are probably getting refills when they don’t want or need them.
Moreover, many PBMs dispense a “second fill” to plan beneficiaries long before the beneficiaries have run out of pills from the initially dispensed prescription. Then, ignoring the excessive number of pills that the beneficiaries already have in hand, the PBMs dispense the “third fill” too early as well. As a result of this “dispensing date creep,” many plan beneficiaries receive far more drugs than they actually need.
Here’s how to fully understand the “dispensing date creep” problem:
If your employee is purchasing a 90 day supply of a maintenance medication from a mail order pharmacy, to obtain a year’s supply your employee needs to receive 4 prescriptions a year, plus 5 days from a fifth prescription (90 x 4 = 360 + 5 = 365). Or looking at a calendar: If your employee obtained his “first fill” on January 1st, given that certain months have slightly fewer or more than 30 days, your employee would need to receive his next “fill” on April 1st, his next “fills” a few days before July 1st and October 1st, and again on December 25th.
But suppose your PBM’s standard practice is to dispense each “fill” after 60% of the previous “fill” has likely been used. That would mean that your PBM would dispense “fills” every 54 days (90 x 60%). Or looking at a calendar: When your employee obtains his first prescription with two refills available, rather than receiving his “fills” on January 1st, April 1st and a few days before July 1st, he’d receive them on January 1st, February 23rd and April 18th. Note that at the time of the “second fill,” your employee will have 36 unused pills on hand from the previous prescription (90-54). And at the time of the “third fill,” he’ll have 73 excess pills from the two prescriptions previously dispensed!
Many PBMs are dispensing refills based on exactly the described 60% protocol. Many others are using a 70% protocol, which results for a single 90 day prescription in 108 excess pills per year! Even if your PBM is implementing an 80% protocol, your employee will still end up for each of his 90 day maintenance prescriptions with 72 excess pills per year!
As you can see, your PBM’s practice of dispensing refills too early – and then repeatedly refilling prescriptions based on the date that the last prescription was filled – results in “dispensing date creep.” Each prescription will arrive with more and more days to spare before your plan beneficiary actually needs the medication, and with your plan beneficiary obtaining an ever-greater number of excess pills.
Here’s a Chart that summarizes the annual impact of a PBM’s “dispensing date creep,” based on different refill practices for 90 day prescriptions that your PBM may be employing:
Ending Your PBM’s Refill Pill Mill
Clearly, if your health plan wants to control its costs – and prevent waste – you need to ask your PBM how it’s refilling prescriptions, and assuming you discover your PBM is engaged in the practices described, you need to insist your PBM change its practices. And do so in writing, in a binding Benefit Change Form.
Note: If your PBM claims your PBM contract precludes you from altering its standard refill practices, you should make clear you’ll take your business elsewhere. Our contractual arrangement for the National Prescription Coverage Coalition prevents refill over-dispensing. Therefore, your health plan certainly has alternatives.
Assuming your PBM will allow you to change its practices, here’s what you should require your PBM to do:
First, tell your PBM you want it to stop automatic refills. Even the stodgy federal government has taken steps to require “refill consents” before refills can be dispensed to Medicare Part D beneficiaries.[1] Accordingly, there’s no reason why your health plan can’t end automatic refills too.
Second, in connection with 90 day mail prescriptions, require your PBM to transmit a “refill reminder” – via email, text, fax and/or robo-call – when 80% of the previously dispensed prescription has likely been used. Then, bar the PBM from dispensing any refill unless your plan beneficiary specifically requests it.
Third, tell your PBM that if a beneficiary requests a refill, the PBM can only dispense the next “fill” when 75% of a 30 day prescription – and 85% of a 90 day prescription – has presumably been used. That will limit potential waste, while still ensuring that every beneficiary receives the next “fill” with plenty of time to spare. For example, for a 90 day prescription, that will mean that the pharmacy will dispense the prescription on the 76th day (90 x 85%), and even if it takes 5 to 7 days for the prescription to arrive in the mail, the member will still get the prescription at least a week before it is needed.
Finally, tell your PBM that the time frame for the “third fill” should be based on the dispensing date of the “first fill” and not the “second fill.” That will prevent “dispensing date creep” and the dispensing of far more drugs than needed.
Unfortunately, many – if not most – PBMs have as their “standard” dispensing practices (i) the automatic refill of prescriptions, with (ii) each refill being dispensed far earlier than necessary, and (iii) the next refill being dispensed based on the previous refill’s too-early dispensing date (rather than the first “fill’s” dispensing date), resulting in “dispensing date creep.” You should do everything you can to stop all these practices!
After you implement new refill protocols, you should periodically check your claims data and make sure your PBM is adhering to your new protocols. The few audit firms that know how to investigate this issue have found that many PBMs violate plans’ written refill protocols, with the result that at least 1% to 4% of total drug costs represent over-dispensing. That’s a lot of waste, justifying a periodic refill audit, even for a relatively small plan.
The Aggregate Cost of Excess Dispensing
To appreciate the aggregate impact of drug over-dispensing, take a look at the federal government’s Drug Take-Back Program. During the first four years that the Program was in effect, people have brought back 4.823 million pounds – or 2,411 tons – of unused drugs.[2]
Although the weight of pills varies, if we assume that the average pill weight is 20 mg., every pound of returned pills represents approximately 22,679 pills. Using that rough calculation, during the Program’s first four years people turned in more than 109 billion unused pills on Drug Take-Back Days.
Health plans – like yours – paid for a large percentage of those unused pills – at great cost. In fact, no matter how you calculate the cost of approximately 109 billion unused pills, it represents tens of billions of dollars of unused drugs. PBMs’ refill practices undoubtedly caused a significant portion of that waste.
Moreover, don’t forget that most people didn’t pay any attention to the government’s Drug Take-Back Program. Instead, they allowed their unused meds to accumulate in their medicine cabinets, or tossed them in the garbage, or flushed them down the toilet. Pity our land fill sites and our water supply, not to mention the poor fish.
In short, hills of unused pills are accumulating, polluting our rivers and aquifers, and costing your plan immense sums unnecessarily.
So as soon as you can do so, investigate your PBM’s refill practices, and change them by writing precise refill protocols. Then periodically use a knowledgeable auditor to run a “quick and dirty audit” and make sure your PBM is adhering to your written protocols. Or join an effective Coalition that will perform this work and make sure that your plan is continually protected.
Every PBM should be required to dispense refills wisely. There’s simply no excuse for the excessive dispensing of pills.
# # #
To read other Rx Drug Alerts, go to our drop-down Menu and click on Rx Alerts.
Footnotes:
[1] See http://www.medicare.gov/part-d/coverage/rules/drug-plan-coverage-rules.html.
[2] See http://www.dea.gov/divisions/hq/2014/hq110514.shtml.
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