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Moving forward with flexibility: Q&A on our specialty pharmacy changes

Key Takeaways

  • Starting Jan. 1, BlueCross changed the way providers should obtain specialty drugs they administer to patients, like infusions. We didn’t change what drugs we cover or ask members to change where they get care.
  • Tennessee employers have asked us for help with specialty drug costs. Our program will save money that goes directly to them and the members they cover – not BlueCross.
  • We phased in our changes with a six-month transition to make it easier for providers and so we could make some changes based on their feedback.

Some of our largest customers – Tennessee employers with more than 100 employees – have been asking for help managing the high and rising costs of specialty drugs. BlueCross and these businesses paid $975 million last year for a subset of specialty drugs: the kind administered by a provider. 

We asked providers to help by getting these drugs from a specialty pharmacy in our network, which can save employer group customers up to 20%. All of these specialty pharmacies are equipped to safely deliver medications anywhere in the country within 24 hours.

Our new process went into effect on Jan. 1, and some providers began using it right away – and we offered a six-month transition period to adjust. Other providers have shared constructive feedback about the new process, and we’ve taken time during the transition to continue our conversations with them and adjust our program.

We asked three BlueCross leaders about why this is an important change for our group customers, what successes we’ve seen so far, and how we’ve responded to provider concerns. Below, you’ll hear from:

  • Natalie Tate, PharmD., whose team manages pharmacy operations
  • Marc Barclay, whose team manages relationships with our in-network providers
  • John Maki, whose team supports our employer group customers

Let’s back up a bit. What did we really change – and why?

Natalie Tate, VP of pharmacy management: We’ve changed the way providers get certain medications. They’re known as “provider-administered specialty drugs” that a doctor or nurse may give a patient in the office, like a shot or an IV infusion. Let’s use Remicade, a drug used for rheumatoid arthritis, as an example.

Before this change, providers had a couple different ways to get Remicade. They could buy it from a specialty pharmacy in our network and have a patient’s dose delivered to them, or they could buy it in bulk from a wholesaler. Most preferred buying in bulk and then billing BlueCross and the member for each dose. But our in-network specialty pharmacies can provide these drugs at lower prices.

John Maki, VP of sales and account management: As specialty drugs became more common and more expensive, Tennessee employers started asking us for help managing the costs. My team and I shared these concerns with Natalie and her pharmacy team, and they began looking for solutions. Those talks started several years ago.

Natalie: We knew we had to act. We also knew we didn’t want to change what drugs we cover, since many of them are life-changing or even life-saving. And we didn’t want to ask members to change where they got care, because we value the relationships our members have with their health care providers.

Marc Barclay, VP of provider contracting: We shared these concerns with providers and asked them for help managing these costs. We’ve had many conversations over the past few years, but we didn’t hear any solutions that would make a meaningful difference for our customers.

Natalie: What we landed on is that requiring providers to use our specialty pharmacy network would be much more cost-effective. We had allowed both options, but “buy and bill” method became costly for our group customers and members. Here’s more on that:

So we launched the Advanced Specialty Benefit Management program on Jan. 1, and it requires providers to use our specialty pharmacy network. We didn’t change the list of drugs we cover, and unlike some insurers, we didn’t ask members to start getting their infusions or injections from different providers.

John M.: The cost savings are essential, but that last part – not changing where members have to seek care – matters to our employer group customers, too. These businesses want health benefits to be convenient for their people.

So, we’re asking providers to use a new method for ordering these specialty drugs. How have providers responded?

Natalie: Some providers are using the new process. These changes apply to roughly 4,000 members across our self-funded group plans, and so far, we’ve processed around 900 claims that went through the specialty pharmacy network. Those have gone smoothly, and our members and groups are saving money.

Marc: We’ve also gotten resistance. There’s been constructive feedback about the process, which we’ve worked to address, but some providers have just been upset they’ll lose revenue.

John M.: We’ve talked about how convenience matters to our group customers and how provider relationships matter to our members. So, it’s been disappointing to see some providers refuse to follow the new process – and refuse to see patients. The providers who choose not to see patients because of this change are making things harder for their patients instead of helping make health care more affordable.

Natalie: Some of the criticisms we’ve heard were based on misperceptions, like the idea that we’d require members to handle the drugs themselves. That’s not true. We also heard that specialty pharmacies aren’t equipped to deliver the drugs the right way – keeping them at the right temperature, things like that. We know that’s not true, either.

Marc: At the same time, some of the feedback has been constructive and helpful. And while we have to put our customers first, we value our providers and want to be collaborative and make this work as well as we can for everyone.

What have we done to try and address concerns raised by providers?

Marc: The first thing we did was offer a six-month continuity of care program – essentially a transition period that allowed providers to keep using the old process while they adjust. We’ve had a lot of meetings with providers to better understand their concerns and to help make sure they really understand how this works.

Natalie: That’s right – and we’ve been able to reassure them about the capabilities of our in-network specialty pharmacies. We’ve also been using this time to create some new options for providers.

Marc: One of the most straightforward changes is expanding our specialty pharmacy network. We’ve had one large hospital system and six infusion centers join the network. That means two things: first, those providers can keep their processes pretty much the same. But second, it means they’ve agreed to similar pricing so our customers will still get the savings we promised.

We’re also offering “dispensing provider agreements” to providers. That’s like a middle ground. Providers can continue to buy and bill for specialty drugs, but at the same rates as our in-network specialty pharmacies. But they don’t have to actually become or set up a true specialty pharmacy.

Natalie: That solution sounds simple, but it’s actually taken quite a bit of work. To be able to submit the claims the right way, many smaller providers would have needed new software. We wanted to remove that barrier, so we went out and found a software solution that works, and we’re paying for it.

Marc: We’re talking with dozens of provider groups about that option now, and we expect many of them to sign on by July 1 or soon after. We started with some of the larger groups but will continue rolling out this option across the state.

What does the future of this program look like? And has anything changed because of the COVID-19 pandemic?

Natalie: We’re moving forward, with flexibility. We believe our program will continue to provide safe, convenient access to these important medications while saving money for employers and members. But we’ve also taken to heart what we heard from providers and put new options in place so they have more ways to work with us to deliver these cost savings.

John M.: The COVID-19 pandemic hasn’t changed our plans, but it really highlights the importance of this program. It’s designed for Tennessee-based businesses that directly cover the health care costs of their employees and families.

The savings our program generates go directly to those businesses and members, not to BlueCross.  And as many companies struggle through this economic slowdown, the chance to save 20% on an expensive class of medications is huge. It can help them continue offering the benefits they really want to provide to their employees.

For more, read 7 key facts about our specialty pharmacy changes or visit

About John Hawbaker, Managing Director, Corporate Communications & Community Relations

A photo of the authorJohn leads a team responsible for communications and community relations strategies that reflect the mission-driven culture of BlueCross. He has called the Chattanooga area home since 2003 and began serving on the BlueCross corporate communications team in 2010.

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