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2010 Winter
The Benefits Post
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Your group benefits newsletter
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Brought to you by Ideal Benefits
Ontario Average
Dispensing Fee
Report
January 2010 – June 2010
Pharmacy
Avg.
Dispensing
Fee
Submitted
All Pharmacies
$9.80
Brunet
$11.71
Canada Safeway
$7.96
Emergis
Reimbursements
$8.13
Clinique Sante
$8.87
Costco
$4.11
Watch those fees…
IDA
$9.78
Essaim
$9.16
Independent
$9.55
Jean Coutu
$9.38
Lawtons / Sobeys
$8.12
Medical Pharmacies
(Osh)
$8.60
Dispensing fees have a significant
impact on drug plan costs. Wise
consumerism encourages employees
to shop smartly for the best dispensing
fees. This can involve simple awareness
promotion, or a more active dispensing
fee cap as part of the plan design. Both
approaches are equally effective.
Meditrust (Mail Order)
$7.81
Obonsoins
$10.60
Pharma Plus / Medicine
Shoppe
$9.85
Pharmasave
$9.63
Pharmex (Mail Order)
$6.67
Pharmx Rexall
$9.47
Shoppers Drug Mart /
Pharmaprix
$10.95
Loblaws
$9.41
Wal Mart
$9.45
Zellers
$9.02
A&P / Dominion / Miracle
Mart
$9.25
The pharmacies listed in the table above
are major chains. Independent operators
have fees that are both on the low and
high side of the ones listed above.
The simple message for employees is
to check the professional fee posted
behind the pharmacy counter at their
next visit.
In doing so, employees will note that
there are local variations in different
areas of the Province and even within
large cities; however, large chains tend
to be relatively consistent in their pricing.
Professional fees (dispensing fees) are
the amounts pharmacies charge for
providing professional services such
as patient counseling, monitoring drug
therapy, drug information to physicians
and dispensing drug products. They
also cover overhead costs, such as
the stocking of medication, maintaining
patient medication records, and general
operating costs such as taxes, employee
salaries, rent, insurance, etc.
The second simple message that plan
sponsors need to communicate to their
employees applies to those who have
indefinite or long term prescription
medications for maintenance drugs.
Under most plans, they will be eligible
for a 100 day supply of drugs at one
time, so it is clearly advantageous to
pay one professional fee versus three.
A simple discussion with the prescribing
doctor will save the plan and in some
cases the plan member from additional
costs. This is before any convenience
savings are even factored into the
overall equation.
www.idealbenefits.ca
249 Yonge Boulevard Toronto, ON M5M 3J1
Phone: 416-924-8280
Fax: 416-323-1984
Email: [email protected]
2010 Winter
The Benefits Post
■
Your group benefits newsletter
This article is reprinted from
Benefits Canada
The Cost Also
Rises
November 12, 2010 | Neil Mrkvicka
Keeping group benefits
costs to a minimum
is a challenge for
all employers. But
according to a survey
by the International
Foundation of Employee Benefit Plans
(IFEBP) earlier this year, more and
more plan sponsors are turning to
wellness programs and cost-sharing
measures to help.
The IFEBP survey uncovered the
approaches plan sponsors currently
use for managing the costs of group
healthcare plans, changes that have
occurred since its 2009 survey and
promising strategies for the future.
The IFEBP surveyed 665 individuals
from corporate plans, multi-employer
plans, public/governmental plans and
professional firms serving the employee
benefits industry.
Uptake and Options
The survey indicated that employers
struggling with rising health plan costs
are adopting additional measures, most
notably wellness initiatives, to improve
employees’ health and control costs.
In fact, 78% of organizations offered
wellness initiatives in 2010, up from
61% in 2009.
The most prevalent types of screening
and treatment wellness initiatives
include flu shot programs (71%),
complementary
and
alternative
medicine (52%) and smoking cessation
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programs (48%). Between 2009 and
2010, there was a significant uptake
in the adoption of complementary and
alternative medicine as a wellness
offering (29% and 52%, respectively).
And the most prevalent fitness and
nutrition initiatives include wellness
competitions (37%), off-site fitness
program subsidies (31%) and healthy
food choices (26%).
Employers are also increasingly finding
new ways to educate employees
on plans and their costs, including
email messages (64%), bulletin board
messages (53%) and newsletters
(52%). And non-cash incentives, such
as prizes or raffles (49%), are the most
common incentives used to encourage
wellness plan participation, followed
by gym or fitness membership
discounts (38%) and gift cards or
certificates (34%).
Nearly one in 10 plan sponsors offering
wellness initiatives report that they
measure the return on investment of
their programs, and a clear majority
(88%) find the results are positive.
The reasons organizations do not
offer wellness programs include
implementation and prohibitive costs
and a general lack of employee interest.
Nevertheless, nearly 20% that do not
currently offer wellness initiatives say
they will likely offer them in the future,
and one of the two most commonly cited
strategies to improve healthcare quality
and reduce costs in the next two years
is offering wellness programs (63%).
Strategies for Savings
As healthcare costs continue to rise,
plan sponsors are most concerned
about increases in usage due to the
aging population. Most group healthcare
cost-management initiatives centre
on modifying plans to include more
participant cost-sharing measures.
Survey participants indicated that the
top five strategies for cost savings
included cost-sharing provisions (79%),
setting reasonable and customary
fee schedules (75%), reviewing
reimbursement levels and maximums
(75%), setting annual and/or lifetime
maximum benefit limits (75%) and
conducting healthcare claims/utilization
analysis (69%).
Due to increased specialty drug use,
government cost shifting and drug
company profits, prescription drug costs
are also rising. A number of employers
have implemented cost-management
techniques to specifically control
these costs, including promoting the
use of generic drugs (62%), requiring
participant contributions (59%) and
using drug formularies (56%). And
nearly half of all employers (48%) are
informing employees of the costs of
filling prescriptions.
Compared to 2009, Canadian sponsors
in 2010 are more apt to promote the
use of generic drugs, place limits on
specialty or biotech drugs and use
high-amount claims pooling, lowestcost alternatives, prior authorization
or utilization management, pharmacy
benefits managers and step therapy/
therapeutic substitution.
For employers, the struggle of providing
competitive benefits and meeting
employee needs and wants while
balancing the organizational budget is a
tough one. But knowing all your options
will make it a little easier. BC
Neil Mrkvicka is a research associate
with the International Foundation of
Employee Benefit Plans.
www.idealbenefits.ca
249 Yonge Boulevard Toronto, ON M5M 3J1
Phone: 416-924-8280
Fax: 416-323-1984
Email: [email protected]