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Pharmacy network efficiency is sought

...As a brand-name drug on the formulary, For Navy Cmdr.

Mark Richerson, director of the Defense Department's Pharmacoeconomic Center, patient behavior with this and other drug classes on the formulary show the powerful effect of raising co-payments.

What we learned, he said, is that co-pays do change market share.

"Patients will switch." That confirmation is important, Richerson said during the Tricare conference, because getting 6.6 million users of the military pharmacy benefit to make more cost-effective choices is critical to department plans to lower soaring pharmacy costs.

In fiscal 2005, defense spending on outpatient pharmacy services hit $5.4 billion, up 80 percent in three years.

But at least, the rate of growth is trending down, Richerson noted.

In fiscal 2003, outpatient drugs costs rose by 27.5 percent.

The increase was 21.8 percent in 2004 and 15.5 percent last year.

And for the first time in recent memory, outpatient drug costs in military treatment facilities actually fell last year, by 5.2 percent or $89 million.

But military retail pharmacy costs jumped 30.1 percent.

"It's an incredibly expensive point of service," Richerson said.

Congress took a first important step toward controlling pharmacy costs in 2000 when it directed the Defense Department to create a uniform formulary of prescription drugs.

Th...

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