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How we’re working to make specialty pharmaceuticals more affordable

For patients with potential life-threatening illness, specialty drugs administered by their physicians often allow them to enjoy a quality of life they might not otherwise have. 

While these medications show how far medical science has come — there are more provider-administered specialty drugs in development than any other kind of drug — BlueCross and the Tennessee-based employers we serve paid $900 million for provider-administered specialty drugs in 2018.

Though these drugs are used by only a small number of patients, all insured people help shoulder the cost — and that cost is becoming unsustainable.

Specialty drugs account for about 1% of prescriptions covered by BlueCross, but account for about 50% of our total drug spend  — and that number is growing rapidly. Further, a large number of specialty drugs are in the pipeline to gain approval over the next few years.

Taking action to reduce costs

Our customers are asking us to do more to help them manage these costs. Our solution is to require providers to order specialty medications from a pharmacy in our specialty network.

Our pilot program will roll out Jan. 1, 2020 with many of our self-funded employer group customers  who have opted in. At any given time, about 1% of their employees receive provider-administered specialty drugs and will be affected by this Jan. 1 change.

These groups pay for their employees’ health care themselves, but use BlueCross networks and services. And that means any savings generated in the pilot will go directly to these employers and the members they cover – not BlueCross. 

One example of a provider-administered specialty medication is Remicade, which can be used for certain auto-immune conditions like rheumatoid arthritis. More than 2,000 of our members used this drug in 2018, and treatment plans can range from 6-12 infusions each year. Under our specialty pharmacy network, the cost of an average infusion is $2,000 less than the current reimbursement. 

We’re not asking members to change where they get care, or requiring specialty drugs be sent to their homes. Our goal is to minimize changes for our members. Rather, we’re asking providers to help members save money by obtaining specialty drugs in a different way.

This new approach requires only one change: to ensure the provider will have the drugs at the time of their visit, BlueCross members will pay the pharmacy directly for the drugs prior to their hospital or doctor visit, typically a few days earlier than they are today. If the drug is less expensive through our specialty network (usually it will be), members will save on their share of the costs. 

All of our specialty pharmacy partners can deliver medications anywhere in the U.S. within 24 hours. Having the drugs shipped from a specialty pharmacy isn’t a disruption compared to having them shipped from a wholesaler.  These pharmacies are already shipping these drugs to providers, including in Tennessee, and we’re confident they can safely deliver them on behalf of our members.

We’re still paying providers to serve patients by administering the drugs. And to help address their operational concerns, we’ve created a six-month transition period and more options for providers to participate in this program. In addition, we’ve added opportunities for dispensing providers to participate in our specialty pharmacy network.

For more information on these changes, visit

Our provider partnerships are essential to ensuring we lower costs for our employer groups and our members.

We’ve also built in processes to ensure our members get the care they need as we navigate this transition together.

That is the commitment we make to all of our BlueCross members – to provide access to the care they need at the best possible price.

About Henry Smith, SVP, Ops & Chief Marketing Officer

A photo of the authorHenry oversees sales and account management, product development, group and member customer service, membership administration, claims administration, and commercial financial management.

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