Late Breaking News
Multiple Factors Spur Big Increases in TRICARE Mail Order Pharmacy Usage
By Sandra Basu
WASHINGTON — Last year, a “perfect storm” seemed to result in more prescriptions filled by TRICARE’s mail-order pharmacy, and Chief of Pharmaceutical Operations Rear Adm. Thomas McGinnis said he hopes the trend will continue in 2012.
Rear Adm. Thomas McGinnis
TRICARE Pharmacy Home Delivery is the least-expensive point of service to fill prescriptions when beneficiaries are not using their local military pharmacy. Throughout 2011, the mail-order pharmacy filled slightly more than 1 million prescriptions a month. In October, however, that number jumped to 1.15 million prescriptions and continued its increase to about 1.2 million in November and to almost 1.25 million prescriptions in December.
What caused an increase in maintenance prescription drugs filled through mail order?
McGinnis said several factors may have played a role, including:
- A public-relations campaign began last summer to encourage and make beneficiaries aware of the savings when they use mail order;
- A highly publicized contract dispute erupted between Walgreens and TRICARE’s prescription-drug management company might have led beneficiaries to start using mail-order pharmacy; and,
- Pharmacy copay changes in October reduced generic-formulary drugs purchased through Home Delivery from $3 for a 90-day supply to zero cost.
“It was almost like the perfect storm: The copays changed on Oct. 1, and all of a sudden generics were free at the mail-order pharmacy for a 90-day supply, so we saw a lot of the [beneficiaries] leaving the Walgreens stores and moving their maintenance medications to the mail-order pharmacy,” McGinnis explained. “We need to continue to urge beneficiaries to help control the pharmacy budget by using mail-order pharmacy for their maintenance medications.”
Controlling costs is especially important for DoD’s pharmacy program, which dispensed nearly 2.8 million prescriptions each week at a cost of $6.7 billion in 2011. That represents about 14% of DoD’s total healthcare expenses.
Encouraging beneficiaries to use the mail-order pharmacy and educating them about the program’s convenience has been one way in which TRICARE is trying to control costs. While the retail network has been the more popular venue for beneficiaries to pick up their medications, TRICARE has been getting the word out to beneficiaries that, if they take the same medication every month for chronic conditions, it makes sense for them and for TRICARE if they use mail order. Prescriptions obtained through military treatment facility (MTF) pharmacies and mail order cost less to DoD than those obtained through retail pharmacies.
Adjusting pharmacy copays is another way TRICARE has sought to incentivize beneficiaries to use the mail-order pharmacy. DoD has urged Congress to support increased copays in the retail network, a move that members of Congress had been reluctant to take until recently.
In 2010, Congress blocked DoD from increasing TRICARE fees through Sept. 30, 2011, but DoD was free to raise copays when the moratorium expired. On Oct. 1, an increase was put into place, upping charges at retail pharmacies from $3 to $5 for generic-formulary drugs, from $9 to $12 for brand-name formulary drugs and from $22 to $25 for nonformulary medications. The nonformulary-medication increase also applied to mail-order drugs.
Generic-formulary drugs purchased through mail order, on the other hand, were reduced from $3 to zero copay. The copayments for prescriptions filled through the mail-order pharmacy cover a 90-day supply, while coverage is limited to a 30-day supply when purchased at a retail pharmacy.
Patients at Carl R. Darnall Army Medical Center in Texas wait in line to pick up prescriptions. TRICARE is promoting mail-order prescriptions as a way to avoid waits (Photo by Brandy Gill, CRDAMC Public Affairs)
In September 2011, President Obama signaled his administration’s desire to adjust TRICARE pharmacy copays further by shifting retail copays from a dollar amount to a percentage copay, a change that would apply to beneficiaries and retirees but not active-duty military.
Military advocacy groups opposed that change, protesting that it went too far. When the proposal came out, the Military Officers Association of America encouraged beneficiaries to send House and Senate members a suggested message that the healthcare proposals “show a shocking insensitivity to — and devaluation of — the extraordinary demands and sacrifices inherent in a military career.”