Radar on Drug Benefits

Midwestern supermarket chain Hy-Vee, Inc. launched a new PBM subsidiary on Dec. 3, joining the already-crowded ranks of retail stores that have done the same, such as Costco Wholesale Corp., The Kroger Co. and Walgreens Boots Alliance Inc. Industry consultants tell AIS Health that while Hy-Vee’s new PBM may struggle to compete with large and well-established players, there are ways it can still appeal to employers that are dissatisfied with the status quo in pharmacy benefits management.

“Starting a PBM today is risky, because the pharmacy benefits market is dominated by a few very large, sophisticated and insurance-integrated PBMs,” says Elan Rubinstein, Pharm.D., principal at EB Rubinstein Associates.

✦ Prime Therapeutics LLC, the PBM co-owned by 18 Blue Cross and Blue Shield plans, hired a new data analytics executive team. The new hires include Urvi Randhar as senior vice president and chief information and technology officer, Sam Mohanty as vice president and chief data officer, and Sarah Taylor as vice president and chief analytics officer. Randhar was most recently vice president of digital products at Healogics Inc., while Mohanty previously worked at United Airlines Inc. and CVS Health Corp., and Taylor formerly held roles at UnitedHealthcare, UCare Minnesota Inc. and Medica Corp. Read more at https://bit.ly/376pKDn.

✦ CVS Health Corp. announced that Neela Montgomery will be executive vice president and president of its Pharmacy/Retail division, effective Nov. 30. Karen Lynch, who will take over as CVS’s CEO after Larry Merlo retires, praised Montgomery as “a seasoned retail industry leader with extensive digital and e-commerce experience” who “brings deep consumer insights.” Montgomery was previously CEO of Crate & Barrel Holdings Inc. Read more at https://bit.ly/3l63NJJ.

As details continue to emerge about the availability of COVID-19 vaccines and how they will be administered, the role that payers will play in the process is becoming clearer.

It’s imperative for health plans to do two key things at the same time, according to Katherine Dallow, M.D., the vice president of clinical programs and strategy at Blue Cross Blue Shield of Massachusetts (BCBSMA). Payers need to help the entities that will be distributing the vaccine to identify the individuals who should be first in line to be vaccinated, and they need to use their resources to help educate the community.

Amazon.com, Inc. made a splash in the health care world on Nov. 17 when the online retail powerhouse unveiled new pharmacy offerings that aim to disrupt the prescription drug market with increased convenience and savings. Industry analysts tell AIS Health that the competitive threat to major PBMs is likely to be minimal, as those firms have certain advantages and capabilities that Amazon won’t easily be able to match.

In fact, Amazon is partnering with one of the three largest PBMs — Cigna Corp.’s Express Scripts, which is now part of the firm’s rebranded Evernorth division — to offer the prescription-savings benefit that will be available to Amazon Prime members. Administered by Evernorth subsidiary Inside Rx, the benefit will leverage Express Scripts’ negotiated rates for drugs to offer savings to customers who are paying without insurance. “It can be used for discounts up to 80% off generic and 40% off brand name medications at over 50,000 participating pharmacies nationwide, including Amazon Pharmacy and the PillPack by Amazon Pharmacy service,” according to a press release.

On Nov. 20, HHS finalized a once-tabled regulation that would revamp the Medicare prescription drug rebate system. While that may seem to be unwelcome news to the health insurers and PBMs that have vocally opposed the so-called rebate rule, it is not at all certain that this version will survive amid likely legal challenges and the upcoming transfer of power in the White House.

HHS first introduced the rebate rule in January 2019 in a notice of proposed rulemaking (NPRM), which aimed to remove safe-harbor protections under the federal Anti-Kickback Statute for rebates that drug manufacturers provide to Medicare Part D plans, PBMs and Medicaid managed care organizations (RDB 2/14/19, p. 1). The goal, HHS Secretary Alex Azar said at the time, was to prevent situations in which patients “pay more than they need to for their prescription drugs because of a hidden system of kickbacks to middlemen.”