RBP =40%, Specialty Rx = 15%

Interesting numbers happen when a plan excludes specialty drugs……………Then factor RFP & CPO…

Group eliminated specialty drugs June 1, 2022. If specialty patient assistance is denied plan pays through a side agreement. Therefore not all members will qualify for patient assistance programs. In this case several high income members needing specialty drugs did not qualify for assistance and the plan continues to pay for those members.

Here are the numbers:

Average total Rx spend -35% between Aug-October vs May-July

Average total Rx spend -44% between Aug-Oct vs Feb-April

Estimated Annual Plan Savings +$1,000,000

Removing most specialty drugs has cut Rx cost by 40%. It would have been greater if the plan wasn’t paying for some specialty drugs through the side agreement.

Reducing Rx spend 40% where Rx spend = 35% of total plan spend = 14% overall plan savings.

If Rx plan spend is 40% of overall plan spend total plan savings is 16%

So in this instance one can suppose an average overall plan savings of 15% by eliminating specialty drugs. But in reality it would be slightly higher since this group continues to pay for some specialty drugs.

Cash Pay Centric plan (CPO) with Reference Based Pricing wrap @120% MC and elimination of specialty drugs (any drug costing more than $700 for a 30 day supply) will reduce plan spend by 50-60% compared to traditional managed care plans. Medical trend is essentially eliminated.