Drug Co-pay Cards & Coupons

Drug co-pay cards and coupons and their impact on benefit plan costs

We’re used to using coupons for anything from free movie admission to cereal. What’s not to like? They’re easy to use and you save some money. But since when have coupons for prescription drugs been popular? The fact of the matter is they’re quite common but drug coupons don’t work quite the same way as a other coupons.

Using drug coupons 

Typically, patients get drug co-pay cards or coupons, from their physicians but they’re also available from other sources including pharmacists and the drug manufacturer’s website.

Co-pay cards or coupons for the most part, are available for brand name drugs only. When the pharmacist bills for the medication, he/she uses the card like a pay-direct drug card to electronically direct part of the patient’s cost (coinsurance, deductible or co-pay) to the manufacturer of the drug. Sounds good so far, right?

The thing is, co-pay cards or coupons might actually cost the benefits plan:

• In an environment where generic equivalents can cost as little as 18% of the price of their brand name equivalent, a $30 coupon doesn’t go very far when the cost of the brand name drug is $100.
• Some co-pay cards and coupons are designed to be the payer of last resort. That means the drug manufacturer is the last payer after the drug plan has paid.

For example:

Jim’s doctor writes a prescription for Crestor with ‘no substitution’ indicated on it along with a $30 Crestor co-pay coupon to help pay for the cost of the medication.

Jim’s coinsurance is 20% and includes regular generic substitution.

Scenario 1:

Jim has coverage through his own group plan as well as his spouse's

Crestor cost $100

Plan cost $80

Spouse's plan $20

Amount paid by coupon $0

Scenario 2:

Jim has coverage under his plan only

Crestor cost $100

Plan cost $80

Amount paid by coupon $20

We have a fix!

Many drugs are available in both generic and brand name forms. Generic forms are typically less expensive but are just as effective as brand name forms. They’ve been approved by Health Canada as equivalent and have the same active chemical ingredient, same dosage strength and same dosage form.

A fail safe solution to avoid unnecessary drug claim costs is implementing Great-West’s Enhanced Generic Substitution into your plan. This plan design element ensures that reimbursement is limited to the cost of the generic version of the drug (even in situations where the prescribing physician has indicated ‘no substitution’ on the prescription). 

Here’s what happens when Great-West’s Enhanced Generic Substitution is implemented into a plan. 

Scenario 3:

Jim's plan includes Enhanced Generic Substitution (EGS)

Crestor cost $100

Plan cost $23 (cost of the generic version)

Amount paid by coupon $30

Shopping With Someone Else’s Money

Generally speaking, when you purchase a product, you research, compare, make the decision, and finally, pay for it. Of course, a big part of the process is shopping for the best price. 

Compare this to the process of getting a prescription drug. It’s kind of like shopping with someone else’s money.

Role                             Played by

The consumer              The patient

The decision maker      The doctor

The payer                     The employer’s group benefits plan

Essentially, the consumer is prescribed a drug by the decision maker. The consumer gets the prescription but all or most of the cost is absorbed by the employer’s group benefits plan. Consumers don’t have to shop for the best price – they might not even know that prices on prescription drugs vary, or they might feel that cost doesn’t matter because they’re only responsible for paying a small portion of the cost. As a result, the payer, (the employer) pays, but hasn’t had any say.  

Sometimes when doctors ask “do you have a drug plan?” it’s their way of asking “do you care how much this costs?” Let’s be fair. Doctors aren’t trained in the world of group insurance, or the impact of claims experience on premiums - this doesn’t fall under the umbrella of their responsibilities. But we’re working to make an impact where we can. When asked, one of our goals is to change the way patients answer this question. 

From the sponsor’s perspective, it’s complex. They want to provide a plan that’s both comprehensive and sustainable, but they’re struggling with the affordability. Plan sponsors fund drug plans, but have had little control over the actual payment process - until now. 

We’re prepared

We’ve developed DrugSolutions, a series of drug plan management options and solutions that focus on balancing the cost to the plan sponsor with the health care needs of their employees. Options and solutions include:

Enhanced Generic Substitution – Generic versions of brand name drugs can cost as little as 18 per cent of the brand name. With Enhanced Generic substitution implemented into a plan design, reimbursement of a drug claim is limited to the cost of the generic equivalent. 

Health Case Management – Taking specialty medications can be overwhelming. Unfamiliar terms, instructions and side effects, can be stressful. This program provides support to enhance the patient’s experience and help him or her understand and adhere to the treatment plan. 

Balance

We’re listening carefully to the concerns of plan sponsors and including their voice in the drug purchasing conversation. Implementing new plan design options can bring balance to contributing to better health outcomes and quality of life, while reducing the cost assumed by plan sponsors.

Barb Martinez, 

Practice Leader, Benefits Solutions