Pharmacy Program

CHCC has negotiated a model Pharmacy Benefit Manager (PBM) contract with Catalyst Rx to enable our members to reduce the cost of their pharmacy programs without cost-shifting to plan beneficiaries.

CHCC competitively selected Catalyst Rx as its endorsed PBM because it: 1) offered the lowest net cost; 2) fully discloses the prices it negotiates with drug manufacturers or pharmacies; and 3) passes 100% of all rebates and discounts to its customers.

The model contract we negotiated with Catalyst Rx guarantees full audit rights. CHCC and its members can review any contract that Catalyst Rx signs with any supplier.

To date, two CHCC member trusts have reported saving $ millions by using the Catalyst Rx contract as leverage with their current PBM vendors. We are confident that members who implement the Catalyst Rx contract will realize far greater savings because of Catalyst Rx’s transparent business model, full return to them of any future price improvements that Catalyst Rx negotiates with suppliers, and innovative physician visit and education program.

Our contract also requires Catalyst Rx to:

1. Establish a Center of Excellence in California with licensed pharmacists, account managers and customer service staff serving CHCC member groups exclusively.

2. Give CHCC members full control over formulary and plan design. Catalyst is available to provide formulary and plan design assistance, upon request.

3. Analyze the prescription choices of the California doctors treating your plan members and visit “high-cost” physicians about clinically effective, lower cost alternatives.

Effective Utilization Management: Catalyst Rx’s on-site physician consultation program is a powerful way to improve provider prescription choices. Standard PBM practice is to communicate with physicians by mail about lower-cost alternatives. Such generic communications will likely be ineffective in the face of aggressive marketing by drug manufacturers of higher priced drugs through industry-sponsored continuing education, free drug samples, on-site physician visits, and direct to consumer advertising.

PBMs also steer physicians and customers to generic medications that most increase their profits without offering you or your members the best value. In fact, the largest non-transparent PBMS today make their greatest profit from owning mail order pharmacies and reselling generic drugs to customers without disclosing their ingredient (or acquisition) costs. You may feel that your PBM effective manages your benefit plan by increasing generic utilization without realizing how much profit it makes at your expense through unfair mark-ups or promotion of certain generic drugs over other clinically equivalent but lower-cost generics.

Pass-through of All Future Price Improvements: CHCC selected Catalyst Rx because it offered the best pricing and the lowest net cost of any of the 17 PBMs that responded to our Request for Proposals. Prices, however, do not stay fixed. All PBMs, including Catalyst Rx, continually seek to negotiate better prices for their suppliers.

The major difference between Catalyst Rx and non-transparent PBMs is that Catalyst Rx passes 100 percent of future price improvements to its customers. It will not pocket the difference between the prices it guarantees in today and the improved prices it negotiates with suppliers tomorrow. As Catalyst Rx grows, so does its purchasing power with suppliers, the benefits of which are passed to you.

This is the value of a fully transparent, 100% pass-through business model. CHCC and its members have full audit rights to ensure that the drug prices that Catalyst Rx pays its suppliers are the very same prices that our members pay Catalyst Rx each time their plan members fill a prescription.

In other words, Catalyst Rx is not a drug re-seller. It derives no profit from selling drugs and has no financial incentive to steer customers to certain drugs. Catalyst Rx is a pharmacy benefit services company that earns revenue only by serving customers. It thus has a powerful incentive to lower the overall cost of your pharmacy benefit plan to the maximum possible extent while providing superior customer service.