Drug formulary choices
Drug formularies define the list of drugs covered under a drug benefit plan. Manulife Financial provides a variety of formularies that can be used based on a plan sponsor’s needs. Standard formularies available include:
Prescription drug plan
A prescription drug plan includes drugs that, by federal or provincial legislation, require a prescription for dispensing and sale. This formulary is available for both pay-direct and reimbursement clients.
Prescribed drug plan
A prescribed drug plan includes the drugs eligible under the prescription drug plan plus non-prescription drugs prescribed by a physician that have a drug identification number (DIN). This formulary is available for both pay-direct and reimbursement clients.
Provincial drug formulary
A provincial drug formulary mirrors the government drug plan in the province where a drug is dispensed. Only those drugs covered under each respective provincial drug plan will be eligible for reimbursement. Both pharmacists and physicians are familiar with this type of plan. This formulary is available for both pay-direct and reimbursement clients.
Coupled with things like, adding generic substitution to a drug plan is an effective way of controlling claims costs. Generic drugs have exactly the same active ingredients as brand name drugs; the only difference is the inactive ingredients such as binders, fillers and dyes. Applying a generic program will result in the member being reimbursed for the lowest cost alternative generic instead of the brand name drug. The exception would be if the member’s physician has indicated “no substitution” on the prescription. As more highly utilized brand drugs come off patent, applying generic substitution provides a great opportunity to control costs. Pharmacists in most provinces will typically dispense the generic; however, to ensure compliance applying generic substitution encourages members to become smarter consumers and ask questions in order to reduce their own out-of-pocket expenses.
Adding a dispensing fee cap. A dispensing fee is the professional fee a pharmacist charges to fill a prescription. Applying a dispensing fee cap limits the amount that the pharmacist will be reimbursed for dispensing the drug. In some provinces there is no limit to the amount that a pharmacist can charge. With ongoing drug reform taking place across the country, applying a cap not only helps manage drug plan costs but it encourages members to shop around to ensure that they have limited out-of-pocket expenses. Applying caps provides controls in advance of escalating dispensing fees.
A detailed review of your plan can uncover simple things that can improve the bottom line!
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