Pharmacy Podcast Network: Asembia 2023 Spotlight | Part 1
Capital Rx Co-Founder & Chief Strategy Officer Joe Alexander joined Pharmacy Podcast Network host and CEO Todd S. Eury for an interview while at Asembia's AXS23 Summit. Show highlights are below, and Joe's segment starts at 00:21:55.
Highlights: Pharmacy Benefits Administration, Health Tech, and Reform
21:55: The payment processing side - the role of pharmacy benefit managers (PBMs).
Capital Rx is not about 5.5 years old. We're a pharmacy benefit manager (PBM) and PBA - the average self-insured employer buys a standard product (network and formulary).
The PBA side is a "parts bin" - health plans and others might only need components, or they can buy all of it.
23:39: You're a tech-driven company. Why was building this new platform necessary?
We've spent 10s of billions of dollars on EHRs/EMRs, etc. - how you activate a claim. But there’s been no innovation on the benefits side because the larger players have consolidated instead of investing in technology. Focusing on things about the traditional model and what it incentivizes… it isn't tech. The older systems are still plugging into green screens, [you're] pressing F7, and waiting in 45-day queues.
So, we felt the need to invest in the infrastructure - i.e., JUDI® - to support and scale the model that we’re deploying. Single-Ledger Model with great service. We knew we could build it, and it became apparent that it's what we had to do to scale the type of model.
25:40: What PBMs started as vs. what they are today... There are state and federal attacks on PBMs because of money being spent that turns into profits for the big PBMs. Capital Rx has come at the market with a different model. Where does PBM reform fit in, and what does it mean for plan sponsors?
The PBM business started with flat admin fees. But it evolved brilliantly into "free"/$0 admin fees. And reform is important because it'll level the playing field and mandate disclosures that help plan sponsors and fiduciaries make better decisions
If you can eliminate spread and require disclosures that help make fiduciaries aware of the costs/fees, that also helps people make better decisions. Connecting the supply chain - the reform stuff will imperfectly help, but it's far better - it is beneficial to us because we are transparent. When [a drug’s] price is an illusion, service and other things become an afterthought. We can't buy off a reference price anymore - nowhere else in the economy do we buy goods like this. We embrace this kind of change.
It bothers me that people say PBMs shouldn't exist. That's like saying public utilities shouldn't exist.
PBMs are very necessary - it’s the pricing model, the economic model, that needs to change.
29:50: How does this play into specialty and rare diseases where it's important to get people on therapy and keep them on therapy?
Capital Rx doesn't own a specialty pharmacy, so we work with partners diligently. We create a marketplace and focus on service. With a simpler model, we have less to manage... there's less administrative complexity. All our client managers are pharmacists. Our team can spend 5-7 minutes on the phone with a member.
That's why our client NPS is 96, and Member NPS is 71*.
We’re working with and connecting the supply chain - when you don’t encumber the price of the drug, you can spend time on what matters most - taking care of clients and members.
Also in this episode:
Srulik Dvorsky - CEO, TailorMed
Laly Havern - Director, Specialty Health Solutions, Oncology/Fertility
Contact us if you'd like to learn more about Capital Rx's full-service PBM and PBA solutions.
* Member NPS of 71 was as of 12/31/22; as of 3/30/23, member NPS is 90.