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The Honolulu Advertiser
Posted on: Monday, February 6, 2006

Paper hassle for drugs soon to end

By Tom Philpott

Every month, about 400,000 users of the military's retail pharmacy network those who have other health insurance have to file paper claims with TRICARE to be reimbursed for copayments and other costs incurred that their primary insurance won't cover.

The paper hassle is about to end, said Navy Cmdr. Jill Pettit, a senior pharmacy official. TRICARE is moving to "online coordination of benefits" for the retail pharmacy network in the next couple of months, she said.

A beneficiary using the retail network now, who has other health insurance, gives to the pharmacist "primary" insurance information. The pharmacist bills the primary carrier and quickly gets back information on what the beneficiary still owes in fees or copayments.

But many retail network pharmacists do not go one more step and communicate online with TRICARE. So, in most cases, the beneficiary is told to pay the balance and file a claim with TRICARE for full reimbursement.

In response to complaints from beneficiaries and their advocates, Pettit said, much of 400,000 paper claims a month will soon end.

"We know this was something that our beneficiaries want," Pettit said.

Rather than filing paper claims, beneficiaries will just wait a few moments in front of the pharmacist while the unpaid portion of the claim is reviewed online by TRICARE and the secondary coverage allowed.

"We're pretty excited about this because this is going to be a real patient satisfier," Pettit said to an audience of medical personnel attending the annual TRICARE conference on Feb. 1 in Washington, D.C.

A COSTLY COPAY

Facing a jump to $22 in their co-payment for Viagra, almost 16,000 military beneficiaries being treated for erectile dysfunction last year decided to change medicine, and did so over just four months.

They switched to Levitra, the only erectile drug still on the military's "uniform formulary." As a brand-name drug on the formulary, Levitra's co-payment is $9 whether obtained in the TRICARE retail network or by mail order. Also, formulary prescriptions are filled at a base pharmacy.

For Navy Cmdr. Mark A. Richerson, director of the Defense Department's Pharmacoeconomic Center, patient reaction to this and other drug classes moved on the formulary show the powerful effect of raising copayments. What we learned, he said, is that copays do change "market share. Patients will switch."

That confirmation is important, Richerson suggested during the TRICARE conference, because getting 6.6 million current users of the military pharmacy benefit to make more cost-effective choices is critical to department plans to lower the trajectory of 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 drug costs rose by 27.5 percent. They rose 21.8 percent in 2004 and 15.5 percent last year.