Prescription drugs can make all the difference in good health. Increasingly, though, general consumers and business leaders that offer health benefits alike are scratching their heads in worry about how much those medications cost. A big part of the problem is the complexity of the American drug system:
- Workers pay their health insurance premiums, with plans often through employers. They also pay copays or cash for whatever drugs they buy at the pharmacy.
- Pharmacies negotiate with drug makers or wholesalers to figure out drug prices, discounts and rebates.
- Insurance companies pay pharmacy benefit managers (PBMs) to manage drug costs, get rebates from drug rebates. The PBMs keeps a portion of the rebates.
- PBMs negotiate with pharmacies over reimbursement for drugs and dispensing fees. They also negotiate prices with drug manufacturers. The manufacturer then provides rebates to the PBM to get their drugs in front of consumers in good dispensaries.
Needless to say, consumers have been frustrated by a lack of transparency. In fact, PBMs are frequent lawsuit targets. But that's where OrchestraRx comes in.
A new, clearer model
OrchestraRx is a pharmacy benefit management company that is putting transparency at the heart of its business strategy. To do that, the company has come up with an entirely new platform and tool set.
"The way prescription drugs are purchased by consumers and health plans is changing," says Paul Ford, CEO.
"Everyone wants greater visibility, transparency and choice. [...] We doubled down on consumerism in healthcare and found a way to leverage big data to create choice, lower cost and a path to optimized health throughout our prescription drug platform. Lower cost and enabling choice will survive healthcare legislation and never goes out of style."
This doesn't mean OrchestraRx will have an easy path. Other PBMs, such as Express Scripts Holding Company, CVS Health, and Catamaron Corp. have a great deal of control. Consumers will have to put their foot down and formally, collectively resist the current opaque system for OrchestraRx to gain significant market share. But the recognition that opaqueness isn't helping is there.
And that's a big start.