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pharmaciststeve's blog
Walmart/Humana at it again
5 Comments
In 2006 they both got their "hands slapped" - along with some other major chains - because they put the Walmart Logo on the Humana Part D Rx cards. Because it was both ILLEGAL and confused Part D folks that they had to get their Rxs filled at Walmart .. if they had Humana Part D.
Now they are putting substantial financial dis-incentives if people get their Rxs filled at any pharmacy other than Walmart/Sams or mail order.
..IMO ...Another example of ".. money talks and crooks walk ..."
When the world's largest corporation sponsors a Medicare Part D plan, a lot of people sit up and take notice. That's what is happening now with this morning's announcement that Walmart and Humana are sponsoring and co-branding a Part D plan for 2011. It is called Humana Walmart-Preferred Rx.
We've been tracking this for several weeks and here's what we know today:
The monthly premium is $14.80 nationwide—about 50% lower than the average PDP monthly premium.
The annual deductible is $310.
The plan hit the low-income subsidy (LIS) benchmark in all 50 states, making it likely that a substantial number of dual eligibles will be auto-assigned to it.
The plan will feature a preferred network of pharmacies that includes Walmart, Sam's Club, and Neighborhood Market stores.
The formulary will be heavily tilted toward generic utilization with three different copay tiers for generics—preferred, non-preferred, and those that are neither.
Once the deductible is met, the copay for a 30-day supply of preferred generics at Walmart is $2 and $0 through Humana's RightSource mail order vs. $10 at other network pharmacies.
For most generics, the copay for 30 days at Walmart is $5 vs. $10 at other network pharmacies.
For non-preferred generics and preferred brands, the copay for 30 days is 20% at Walmart vs. 37% at other network pharmacies.
For non-preferred brands, the copay for 30 days at Walmart is 35% vs. 50% at other network pharmacies.
Comments
Location: New Albany, IN
Posts: 218
There was a group of "5 talking heads" on Fox this afternoon discussing this co-branding and the first thing out of their mouth was putting forth a comparison with this and MC DONALD'S.. Of course, Mc Donald's core menu is UNHEALTHY !
The total discussion point was how much the heath care system could save.. when we all know that there is going to be a huge push for therapeutic substitution.. which is probably fine for 80% of the population... I just feel sorry for those in the 20%.. whose diseases may be poorly managed.
Humana came into the Medicare Part D program with a very very low premiums... mostly because the first year they were not fiscally at risk.. they used it to "sucker" seniors in signing on to their program... after the first year... premiums started to soar and human psychology being what it is... the vast majority of seniors did not bother checking out other options during the open enrollment period... just paid the dramatically increased premiums.
I would not be surprised to see this repeat with this co-branding.
If these entities - or any entity in pharmacy - really had a concern about patient's health and positive outcomes and all the things that goes along this line. They would establish a methodology that would help patients take advantage of the Pharma's free med program.
BUT that would only provide them with goodwill & actually may help these patient's improve their health and quality of life.
Apparently they don't want to take the risk of betting on goodwill to bring people into their stores to spend their money.
Location: Toledo, OH
Posts: 23
Unlike you, I do not claim to be judge and jury about Humans's illegal activities (or any other company for that matter). As imperfect as our legal system may be, I leave that up to the experts in our legal system to sort it out. And quoting anything from FOX News, arguably the most prejudiced and inaccurate news service in the nation, doesn't exactly help your attack on the legality of the Humana/WalMart deal. You lost me when you started to compare McDonald's menu with the Humana/Walmart card! Huh?.
As distasteful as "therapeutic substitution" and raising premiums are to me, it is being done in many, if not in the majority, of PDPs under Medicare Part D, not just Humana. This is basically a function of a very poorly written government Medicare plan that was pushed through Congress days before the end of the Bush administration.
And while I am not a particularly big fan of PBMs, PDPs and the like, they are in business to make a profit and no one is forcing any Medicare recipient to choose one over another. While I think better controls can be put in place, it is still a private-sector, fair market enterprise where competition should be expected. Until that changes, we will continue to see "come ons" and premium increases as well as other market strategies, as we do with any other commodity being sold.
I take issue with your posts because they are constantly painting a broad brush of whatever you are talking about without specific facts about specific companies to back up your "glass is half empty" doomsday comments.
For whatever reason, you don't like Humana, I get that....but it is unfair to condemn every PBM or PDP as guilty by association. This is unfortunately the environment in which we practice. Saying "boo" is not going to scare them off. Pharmacists have to create a new environment in which to compete. It's evolving, but ever so slowly and there simply is no place for your old school negativity in that process.
Location: New Albany, IN
Posts: 218
The talking heads on Fox brought up the comparison of Mc Donalds.. and just like Mc Donald's core menu..can be unhealthy.. what may evolve out of this co-branding could be unhealthy to some served by the program.
It is apparent that you don't watch Fox news .. but if you did.. you would notice that MSNBC ADVERTISES their programs on FOX... I don't know if it is part of their "fair and balanced" philosophy or they are so confident about their dominance of cable news... or the competition is so bad... that they are willing to take money from the competitor and let them advertise on their channel.
If one pays attention to what is being said about where pharmacy is going.. Pharmacy seems to have one idea.. and the majority of the rest of the players (corporate pharmacy, Insurance, PBM & government) have a different opinion.
Recently the Sec of HHS published a statement how primary care was going to be provided when national health insurance kicks in .. pharmacy/Pharmacists were not mention once ! This is from the entity - the FEDS - that are going to call the shots on our health care system in 3-4 yrs. It isn't as if we have not had representation on "the hill". We talk about MTM and collaborative practices.. if we are not even on the roster.. how are we going to be a player?
Corporate pharmacy has done as much as it can to de-personalize pharmacy services.. think mail order.. drive thru windows... centralized call centers .. central fill.. IVR's free antibiotics, $4 generics.. yes technology can make us more efficient..but at what cost.
Pharmacy talks about improved compliance.. has anyone bothered to calculate the near term cost to the system.. insurance companies could care less about long term savings...but they do care about short term costs.
Our daughter works for a bio company in Oakland that has developed a process to utilize a number of blood tests and come up with a fairly accurate prediction of if a person is going to become a Type II DM within five years... Diabetes ..the disease that cost our system the most to treat... you would think that as focused as our health system is suppose to be on preventive care.. they would be all over this.. The medical community has accepted the testing .. however.. their biggest obstacle is to get the payors to consider paying for it. With a large chunk of health insurance having annual open enrollment period.. why should they be interested in putting out money so that -maybe - another insurance company can save money down the road.
With ~ 1/3 of the community pharmacies being indys and >50% of those being in communities of < 20,000 the impact of those Pharmacists that want to "make a difference" can only have a impact on a very small portion of our population.
Those of us who work in corporate pharmacy... have witnessed first hand the increased workload and stress levels.. while there has been a shortage of Pharmacists. If individually or collectively could not cause a change...One can just imagine what is going to happen when that shortage turns into a surplus.
We are looking at the potential "perfect storm"... a dramatic increase in bodies coming out of school and the peak is still several years off. Just as new store growth has slowed... Walgreens has moved from 100% organic growth.. to acquiring regional chains. CVS stated that they were going to buy 400 indys a year.
Rite Aid is on the brink of bankruptcy... they almost got de-listed from the NYSE and was going to have to do a reverse split to keep that from happening.. You can buy a share of their stock for less than the cost of two candy bars and they are losing $0.02+ for every dollar in revenue and their same store revenue is flat - at best ! If they file chapter 11... they will be forced to close under-performing stores... maybe as many as 1000....~ 20% of their store count.
IMO... what we are seeing now is just a version of what Standard Oil did that caused the Sherman Anti trust act to be enacted... but .. now we have public corporation co-partnering with a Sherman exempt insurance company to get to the same goal of minimizing competition. Pharmacy/Pharmacists are just a pawn in this game. When the manpower supply flips... our value will decrease and our expendability will increase.
Location: New Albany, IN
Posts: 218
The "branding"of the Part D cards was ILLEGAL.. and they were force to stop distributing. Unfortunately, Medicare did not force them to replace the cards. So this was in place and remained to continue to re-enforce to these seniors what their drug card was - or should be - used at Walmart.
We have seen over the years - or at least I have - mergers or joint-ventures with the promise of "fire-walls" between the two entities ... that soon the fire-wall was ignored or circumvented..
Merck & Paid was the biggest example... and there are a lot of questions about the CVS/Caremark merger and some HIPPA violations that are now being investigated by the FEDS..
I live and have lived my entire life in the shadow of the Humana's corporate headquarters and have read in the local papers of all the questionable legal activities... and some not so questionable but just plain illegal that Humana have tried over the years.
Both of these entities have been known to skirt the legal/illegal line and will cross it.. if they think they can get by with it... and/or if the profits they can make will exceed what the fine is going to be if/when they get caught.
IMO.. it is just a matter of time.. before what is questionable to make a profit... when these two entities will not be happy with that profit and "cross the line" to make more.
Location: Toledo, OH
Posts: 23
PharmacistSteve, would you please explain to everyone EXACTLY how the Walmart/Humana Part D plan is "illegal?" (or even unethical for that matter). Sounds to me like it is just good business. While it will obviously put a big dent in the some independents' and some other chains' share of market armor,(as well as many other PDPs' plans) there is a strong argument that could certainly be made that it is a win-win deal for Walmart, Humana, and the many consumers who may choose the new Walmat/Humana Part D plan.
Exactly who is the "crook" here? Are you implying that anyone who competes on a new level are crooks? Certainly not the patient who is at the poverty level (and there are more of them every day during this recession) who has to make a decision whether to eat or get their medications.
As far as I know, this is still a free country and people can choose which provider they want based on their needs. While I have empathy for pharmacies who cannot compete, there is much more to what makes a pharmacy successful aside from price and there are many people who choose those features over price alone.