Confusion with Preferred Pharmacies and Part D Insights

Insight from the SMS pharmacist on staff, explaining the pharmacy costs when it, at first, appears confusing. There is also a discussion on the "Max Out of Pocket" with Part D for 2024 and how that actually works. He also talks about submitting a new application after the first one, if you had to. What are the options there when using our tools. See the video and transcript: Transcript: I wanted to go over one of the main things that I see every year. I probably get nine, 10 questions on this every day. They come from marketers, they come from agents. There's a lot of confusion this year with how things are working with the out-of-Pocket Max and with how pharmacies are quoted in our platform. So I selected one of the questions. This came in last night from Kevin Higgins, and it was for WellCare, PDP plans. I'm consistently seeing higher costs when using King Supers as the preferred pharmacy. It's pharmacy chain in Colorado. They are preferred on the WellCare plans, but they're displaying costs that are higher than our in-network preferred column. So a lot of times agents think we have an in-network, preferred column in LA Pro. We also have a client column client for client pharmacy. And when those two numbers don't match, agents are often confused. Speaker 1 (00:53): They think those should be the same. And that's not the case because we are actually looking at an actual preferred pharmacy on the plan. So WellCare Classic for example, right here when we're quoting that plan, the in-network preferred Pharmacy column, those total costs here, that's an actual pharmacy. It's a pharmacy given to us by the quote vendor. They're just randomly selecting one based on close proximity to this client's zip code. And if you want to know what actual pharmacy that is, you can click on the pharmacy network circle and that'll show us That's ACDS like top left corner here. Default preferred pharmacy is ACVS physical location. If you were to select that same pharmacy for the client pharmacy, you would see exactly the same costs in both of those columns. But they're picking a representative preferred pharmacy. Now, king Supers is also a preferred pharmacy, but they're not going to have the exact same costs even though they're both preferred. Speaker 1 (01:57): And why is that? It's a huge question. So if you don't pay attention to anything else I ever say, this is probably the one take home message to really understand. It'll help you and help agents when we dive into the plan details to find out why is this pharmacy that is preferred $880, whereas the default preferred is a lot less, right? $250 less approximately. Why is that? Well, if you dive into the plan details, we are going to show you the full cost of the drug for each pharmacy. So even though these formularies are the same, they're being applied the same. Full cost of drugs is a big driver for differences. And so you'll see here at the King Supers, you've got relatively high full cost of drug. Now why is that? Because they're negotiating contract prices. A long time ago, WellCare, this classic plan was grandfathered in. Speaker 1 (02:58): It's an old plan. It's not very competitive, but these contract prices, the prices that the carrier and the PBM are willing to pay the pharmacy for these drugs, it's kind of old things have come down in price. And so that King Super's negotiated contract, which is an independent pharmacy contract. You don't have to know all of this, but just know there's differences. And the differences exist because contracts are negotiated different for independent pharmacy networks versus the big chains. So here we're looking at CVS as a big chain. They've negotiated really good a really low cost because of an affiliation they have with the carrier, plus they're buying in bulk. They're getting better costs for certain drugs. And so because this cost is basically $7 less per drugs times seven drugs, you're talking about a total cost per month of five 20 when they fill these prescriptions versus King Soopers, which is $32. Speaker 1 (03:57): So if you take that difference times 12 months, that's basically the difference you're seeing here. So that should be an easy question for you to answer. Anytime an agent says, I don't understand, why are these two columns different? Tell them to go to the plan details, look at the costs in each of the pharmacy tab. That full cost is different and that's driving the difference. So they don't always understand that they think something's wrong with our system. If I go to medicare.gov, it's the same $32 a month at King so's pharmacy. So our costs are spot on with medicare.gov. If I go to the carrier's website, their plan details, it's the same thing. You'll see these full costs are exactly the same as what we're quoting. So the reason there's consistency across medicare.gov across the carrier's quoting website and in LA Pro, the reason that is, is because this price file comes from CMS, the carriers. Speaker 1 (04:55): The pharmacies, this price file is developed. It comes from CMS to the quoting vendors and everybody's really quoting the same information unless there's some glitch. Now that happens maybe twice a year where I'll see something a little bit out of line and agent reports that I confirmed stuff's not matching between pro medicare.gov and the carrier, and I'll resolve that. That's a real issue. But the first thing you should do as a marketer and how you should talk to your agents is let's look at those plan details tabs, make sure that that full cost of drug, we're seeing those differences and those are real differences. And your client's probably going to experience those differences when they go to the pharmacy. There's no quoting malfunction. This is just how the landscape works. If it didn't work that way, why would we quote preferred pharmacies individually? We would just say, here's preferred pharmacies are all the same. Speaker 1 (05:43): But we don't do that. We say you need to quote your client's pharmacy because those costs are different. And another reason why those are different. There's three or four different drug wholesalers, there's AmerisourceBergen, there is Cardinal Health, there's McKesson. And so these pharmacies are buying from different drug wholesalers. So the costs are different when they're acquiring the drug, plus they're buying at different times. So multiple factors here, why a drug would be different at pharmacy A versus pharmacy B, but we show you how to find those differences in the plan details and we match across medicare.gov and the carrier's website. So that should give you all a lot of confidence. When an agent asks you a question about why this is happening, don't send it to me. Explain to them why differences exist and here's how you see those differences. And yes, this pharmacy may be cheaper for your client than this other one. Speaker 1 (06:34): That's why we quote individual pharmacies. So the expectation should never be because one pharmacy is preferred and another pharmacy is preferred that those two preferred pharmacies should have the exact same costs. That's not a realistic expectation and that's not how the landscape works. If you have more questions on that, let me know. If you have agents that aren't understanding it, send 'em to me. I answer this question 10 to 15 times a day throughout AEP. I'm happy to answer those questions, but that's the level of detail needed for you to be able to answer that question. If you don't want to find send 'em to me. I'll explain it. I'll send screenshots. I'll go to medicare.gov, I'll show them how we match and I'll explain the nuance. I'm happy to do that. Another really confusing thing for agents, and I noticed it right here when I was looking at WellCare's website, let me find it here. Speaker 1 (07:24): Total out-of-pocket threshold $8,000, right? So I had agents early in AEP ask me the out-of-pocket max is 8,000, right? And I'm like, well, it's 3,300 is what your client's actually going to take out of their pocket and give to the pharmacy before their drugs are zero? And that caused a lot of confusion. They said, well, it's saying 8,000. I keep reading 8,000. I don't understand. Is it 8,000? Is it 3,300? And it's not helped by the fact that Medicare is always called this troop, right? Troop true out-of-pocket costs, which of course isn't the true out-of-pocket costs. The true out-of-pocket costs the true out-of-pocket max for your client thirty three hundred and twenty twenty four. If all those drugs are on formulary, why did they say true out-of-pocket costs and then quote 8,000? Well, they're getting credit for a manufacturer's discount of a drug. So as we say here, 95% of the cost of the drug will count towards your true out-of-pocket spending. Speaker 1 (08:22): But of course they have a typo. It says out out of pocket spending. I mean, again, Medicare doesn't help sometimes when it's so fuzzy. But if I'm filling $8,000 worth of drugs, I'm going to hit that 3,300 out-of-pocket max. I may not pay that 8,000. I'm not going to, I'm going to be subject to 3,300. But that true out-of-pocket number that they quote is also a discount the manufacturer is giving you. So you're getting 95% of that full cost of the drug credited towards your troop, but you're not paying that. That's a discount that the manufacturer is having to take on that $8,000 drug. You're going to pay 3,300 of that and then you're going to hit that 8,000 because when they fill this prescription, they're seeing the full cost, the 8,000 of what you're subject to 3,300 as long as those drugs are on formulary. Speaker 1 (09:11): So it's a really tricky question too, and I'm happy to answer that. But those are really two big things this year that are really confusing agents. I'm going to stop there and if people have questions, shoot me those questions real quick in the chat or speak up if you have them. But are we clear that? And sometimes you'll see a standard pharmacy, a standard client pharmacy, this is half shaded orange, it's this icon here. You'll see that half shaded orange and the cost will be lower than the preferred pharmacy column. And agents are like, this doesn't make any sense. Everything's broken. It does make sense because again, it goes back to the full cost of that drug. So if there's a tier four or if they're in a deductible phase and that standard pharmacy, which is a mom and pop shop that orders their drugs every day, they're seeing that lower price because they bought it yesterday. Speaker 1 (10:05): CVS bought it in bulk three months ago. They have it sitting in a warehouse. They don't know the prices has changed and they don't care. And so when that drug hits the pharmacy shelf, that retail cost, that full cost is much higher because they didn't buy it yesterday. They bought it three months ago and since it's since dropped, so oftentimes you'll see a standard mom and pop shop that's ordering it every day, getting lower prices for the full cost of drug, passing those on to the consumer. They're really good at passing lower costs onto the consumer. Big pharmacy chains aren't very good at that. They move slow and they store stuff in warehouses. And so it's not uncommon to see a standard pharmacy with a lower cost than a preferred, and that confuses agents. But dive into the plan details. You'll see the full cost of drug is different and you'll be able to explain that to the agent. Are there any questions coming in or does anybody have any questions about what I've gone over? Speaker 2 (11:00): I don't see anything in the chat. Any questions from anybody here? Good info. Excellent. Who's come across either of those issues before? So a lot of hands being raised here. I know Brandon, Matt have one for Chris Westfall here, so hopefully you guys can get that squared away with him and this helps answer it. I know I was really confused in my answer to you guys. So thanks Speaker 1 (11:24): Ryan. I don't see it and I don't love the landscape. If I could just pick any job they have in the country right now, I would go work for CMS and tell them, listen, we got to do this differently. We have to be more clear with our communications and then we have to be able to somehow standardize this full cost of drug across the landscape. Because I've seen, I'll just mention one other thing, which is just bonkers, but here's a drug recently. This drug used to be super expensive, this abiraterone, and I'm just going to remove these other drugs and quote that one real quick because I mean you'll see full cost of drug for this drug $2,000 sometimes and sometimes a hundred dollars. So what do you think that does to the quoting? How can you determine what the best cost is for your client? Speaker 1 (12:14): Look here, we've got a preferred pharmacy saying 1470, same preferred pharmacy network, but a different pharmacy. It's 59 50. Why is that? Well, if you dive into that, and this is WellCare value script, most popular plan this year, tier four drug full cost of drug at King Soopers is $8,900. Now, that was realistic a while back. This is also a pretty specialized drug, and most pharmacies don't even ever fill this in a given year. So they're going off drug cost data from some claim that they submitted. It's their best guess, but it's not that accurate because who knows when that was filled. Now the drug cost has come down and it's $200. So when an agent sees this, they immediately send me a ticket, and rightfully so it doesn't make any sense, but how up to date a certain pharmacy's price is No one in Aurora, Colorado going to King Super's has probably filled this prescription in the last year. Speaker 1 (13:11): So it's still really expensive when the pharmacy looks in their computer and says, let's see, last time I filled this two years ago, it was super expensive, but this preferred pharmacy, which I think is what ACVS, it probably has filled it in the last month. And so it saw that new price, and there's no way for me to fix that. I can't go to CMS and say, Hey, I think I know what's going on with this landscape. Can I dial stuff in a little bit? For our agents, they're going to be like, no, you might do stuff to benefit SMS or benefit a certain carrier. So because of that latency, we'll see a lot of weird quoting scenarios and they're not wrong. Their best estimates based on when that pharmacy filled that drug. They're not trying to be misleading, but they haven't filled it in the last year and they don't know that the price is lower. Speaker 1 (14:02): And if I went on GoodRx and I just said, what are different prices at different pharmacies, which I do sometimes you're going to see some where it's still $2,000 and you're going to see some where a pharmacies filled it recently and it's a lot cheaper. They don't standardize that either. They're taking the cost that the pharmacies are giving them. So that's why this is a difficult landscape and why we get a lot of questions, but that's how the system works and hopefully that helps a little shoot me questions if you got 'em. But hopefully that in your back pocket at least helps you tell an agent why that exists and that it's going to be the same on medicare.gov. It's going to be the same on the carrier's website. Don't question our quoting tool. Don't start believing that maybe what we're doing is inaccurate. That's not the case. Speaker 1 (14:46): We are spot on with medicare.gov. We're spot on with the carriers. The landscape's a little nuanced, and if you don't have confidence in what we're quoting, that hurts us. It hurts our reputation. It doesn't make agents feel confident. I've gotten a lot of tickets this year where agents are like, I don't even know if I can use your quoting tool. This doesn't make any sense. And I explained it to 'em and they're like, okay, I didn't know that. But their first gut reaction is they just throw their hands up and they say, it's stressful. AEP. What I'm seeing doesn't make any sense. Everybody hates me. The world's collapsing around me. Your costs aren't correct. And so, I mean, some agents are really like that. I have to talk 'em off the ledge. That's Speaker 2 (15:28): Exactly on the ledge. See, Hey, Ryan, is there, when you talk about that default preferred pharmacy, I mean usually it probably comes up with Walgreens or CVS or something in metro areas, but could there be a situation where King Supers is the only preferred pharmacy within whatever? Speaker 1 (15:49): Absolutely. Absolutely. Yep. It's dynamic. It doesn't have one preferred representative pharmacy for every plan. It looks at that client's area and it tries to pick one from that client's geographical area that's relatively close to that client. So you will see for the same plan in a different zip code, a different default preferred pharmacy, it's going to look at where's this client? What are the preferred pharmacies available? And maybe it brings back the closest one to that client's house, but it might not pick the exact one. Sometimes it does pick the exact one. You'll see Kings there for both. It's the same one. But yeah, that's a good question. And it is responsive to geographical location that will serve up a new default preferred pharmacy based on just whatever zip code that is and the pharmacy's available. Speaker 3 (16:41): Hey, Ryan can have how you can put the cursor and then that little window pops up. Is there a possibility that there could be that little bit of language to kind of give them a heads up regarding everything that you're explaining? If they will put the cursor and the thing would just kind of pop up a small kind of disclaimer of, Speaker 1 (17:04): Yeah, instead of preferred pharmacy, click to edit. We would maybe have some information text there that kind of explains that nuance. And I think we could easily do that. I could put a ticket in for that. I don't think that's a lot of work, so that's probably a good idea. Speaker 4 (17:20): What about if you did another column and maybe Ryan's recommendation to a pharmacy for the agent and then you could, Speaker 1 (17:29): That doesn't work really well because again, it's dynamic and I can't guess as to what pharmacy is going to have the best price or that would be not something that I could build out because there'd be no logic there that I could really apply to be useful. Unfortunately, Speaker 2 (17:48): Trash can. Oh yeah, Ryan, yesterday there was a question or a comment about, so when an agent submits an ACO enhanced aco, when they do that first app, if they have an active app on that client, they can't go back. And let's say they found out that their drugs were covered better at a different pharmacy on a different plan, and they go to submit another aco, the system won't let them allow or won't allow them to submit another. There was a comment made that deleting the current application would allow them to do that. Can you comment on that at all? Is that true? Speaker 1 (18:30): My experience is you're allowed to submit a second. Unless things have changed very recently, you can submit a different plan for that same client in the same plan year. You just can't submit the same plan for the same client in the same time year. Now, maybe that has changed, but my expectation would be you can submit a different plan for that same client during AEP. If you feel like last week maybe you sent the wrong plan. So if it's not working that way, let me know. That would be a change from last year and a change from how it's historically been done. Deleting an application will not help you get over that hump, Speaker 2 (19:05): But for the same plan would. So deleting an application won't let you get over any hump? Speaker 1 (19:10): Nope. Nope. That's not going to fix anything. The only workaround for that, let's say I, earlier this year, I had a client move from Colorado to Nebraska. I put them on WellCare value screw. And let's say that this year, for whatever reason, I have to enroll them in WellCare value script. Again, maybe they've changed regions and the plan ID is different. So plan is the same. Plan ID is different. Something like that. If LA Pro doesn't let that happen, because when you go to do that, it shows you the submission page. It shows you the confirmation from when you did it three months ago. That means our vendor, when we pass them that information, they're like, you've already got to submitted enrollment for this client. Here's the confirmation page. And they won't let you proceed. You need to create a new client profile. So just in pro, just create a new lead, name it the same, and you can submit the enrollment from that. You can make a note and then you can either keep that profile or delete it. That's one option. I don't love that option, but that's one option. The other is to go directly to the carrier's website and submit the enrollment through the carrier's website or MID. It's going to work on any of those three different ways, but I don't know what the most convenient way for the agent is to submit that second enrollment for the same plan and the same plan year. Speaker 2 (20:26): But you just said if they do it on LA Pro for the first year, they can go to MID and do it on Speaker 1 (20:32): That? Yes. Yep. Because what our vendor's looking at is we pass them a lead id, we pass them lead information, client information, and then plan information. And when that enrollment's complete, all of that is seen by them. And so when we try to do a second one for that same lead id, that same client profile, that's when they say, you've already got one here. There's nothing for you to do. Here's the confirmation number. So creating a new client profile, just a new lead for that client will let you submit it through our system because they don't recognize that new lead id. Everything's a number to them. So they're going to see that same number for the original profile. But if you create a new client profile and send it, they see a different number. So they don't treat that as the same client

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