Understanding the ENTIRE Payment Process for Prescription Drugs
September 8, 2009
View the Program Flyer here.
The NYC office of the law firm of Hodgson Russ LLP (Bethany J. Hills, Esq.) hosted a lunchtime Coffee, Croissants and CLE Credit program, entitled Understanding the Entire Payment Process for Prescription Drugs. The speakers or the program were James R. Schiffer R. Ph., Esq., of Allegaert Berger & Vogel LLP and Craig M. Burridge, M.S., CAE, of the Pharmacists Society of the State of New York.
Mr. Schiffer is a pharmacist and a lawyer who brought together these combined experiences to address the topic. He began by offering an extensive history of the development of the payment process from the perspective of pharmacists, patients and prescription drug manufacturers. He explored the innovation of Pharmacy Benefit Managers, the involvement of the American Society of Automation in Pharmacy and the National Council for Prescription Drug Programs. One of the major turning points in the evolution of payment mechanisms, according to Mr. Schiffer, was the utilization of Third Party Administrators by state pharmacy organizations. The lack of regulation and transparency within the payment systems was highlighted and case studies impacting prescription drug cost were presented. Pricing issues involved with generic .v brand drugs were explored and Mr. Schiffer identified key areas - such as state law regulations, clinical decision making, and FDA bioequivalency decisions - that contribute to added costs.
Mr. Burridge, a frequent lecturer to Human Resource organizations and large corporations seeking to curb their prescription drug costs, then walked the audience through a number of shocking "tricks of the trade" in the area of prescription drug pricing. The issue of pricing "spreads" - the difference between the maximum allowable cost permitted by the health insurance plan and the discounted average wholsesale price (AWP) - was discussed with specific examples highlighting the hidden income that may be obtained by pharmacy benefit managers. The issue of transparency and permitting auditing by employers and health insurers was also evaluated. Mr. Burridge presented a number of practical case studies that inspired spirited discussion from the audience.
The questions posed by the audience were prompted by the speakers’ case studies and were answered, debated and discussed by the presenters as well as experts and other participants in the audience.