Wal-Mart $4 Generic Program Evaluation

Generic Medication Program Evaluation for Community Health Centers

Project Between IA/NEPCA and

Siouxland Community Health Center

Dr. Kyle Peters, Pharm.D.

Clinical Pharmacist, Adjunct Clinical Instructor UNMC College of Pharmacy

Siouxland Community Health Center

Sioux City, Iowa

Generic Medication Program Evaluation for Community Health Centers

Introduction

A. The purpose of this evaluation is to look at the emergence of generic medication programs, and to analyze the impact they have on community health centers and their patients. The generic prescription programs that will be analyzed are the Wal-Mart and Target $4 generic programs, the K-Mart 90-day supply program, and the Rx Outreach mail-order program. Manufacturer-sponsored medication assistance programs will not be analyzed, since they are only available for brand name products, and have varying qualification requirements. The cash price of the medication will be analyzed; however, co-pays if the prescription is submitted through a third party payer will not be analyzed, due to the complexity of co-pays from different payers. This analysis will focus on the cost of the medication, and will not make determinations of the affordability of medication, since affordability is composed of many variables.

Currently Available Programs for Low-Cost Generic Medications

A. Wal-Mart

On November 28, 2006, the Wal-Mart $4 generic medication program became available at all Wal-Mart and Sam’s Club pharmacies in the United States. The list is comprised of 143 different medications in 26 therapeutic categories. Patients can get a one-month supply of commonly prescribed dosages from a predetermined medication list for $4. If the patient requires a prescription for 60 tablets per month, but the limit is 30 tablets for $4, the patient will have to pay $8 for a one-month supply. Patients can get more than a one-month supply for multiples of $4, subject to the pharmacist’s clinical decision, if the prescription is written for more than a 30-day supply or has refills available. A three-month supply would cost $12, and a year supply would cost $48. For chronic medications, a 100-day supply would cost $13.33. If the prescription is written for a higher dose of a medication, with the instructions to cut the tablets in half, 15 tablets for a 30-day supply would cost the patient $4.00, and 30 tablets for a 60-day supply would also be $4.00.

B. Target

On November 20, 2006, the Target $4 generic program became available at all of its pharmacies nationwide. The list is the same as Wal-Mart’s for the drugs and doses that are covered. The same number of tablets can be obtained for $4. If the patient requires a prescription for 60 tablets per month, but the limit is 30 tablets for $4, the patient will have to pay $8 for a one-month supply. Patients can get more than a one-month supply for multiples of $4, subject to the pharmacist’s clinical decision, if the prescription is written for more than a 30-day supply or has refills available. A three-month supply would cost $12, and a year supply would cost $48. For chronic medications, a 100-day supply would cost $14.00. If the prescription is written for a higher dose of a medication, with the instructions to cut the tablets in half, 15 tablets for a 30-day supply would cost the patient $4.00, and 30 tablets for a 60-day supply would also be $4.00.

C. K-Mart

(See attachment for medication list)

K-Mart has had their 90-day generic program for longer than both Wal-Mart and Target Programs. The list is comprised of 94 medications in the classes of: cardiovascular, diuretics, behavioral health, diabetes, muscle relaxants, gastrointestinal, women’s health, pain/inflammation, and miscellaneous. The list is not available online, but can be obtained at the pharmacy. They offer a 90-day supply for $15.

D. Rx Outreach

Rx Outreach is a mail order prescription assistance program for generic medications, which is located in St. Louis, Missouri. Their list has 117 different medications from over 40 different therapeutic classes, and 35 of these medications do not appear on the Wal-Mart/Target programs. A 90-day supply is $20 or $30 depending on the medication. This price does not change for the number of pills the patient receives, and shipping and handling is included. Patients have to qualify for the program based on household income and number of people living in the house. No financial documents are required to apply for the program.

Benefits and Limitations of the Currently Available Programs for Low-Cost Generic Medications

A. 340B Pharmacy Analysis Explanation

The 340B pharmacy used in the comparison is the Siouxland Community Health Center (SCHC) Pharmacy. SCHC is located in Sioux City, IA. Randall Rouse, R.Ph. is the pharmacy manager, and Dr. Kyle Peters, Pharm.D. is the clinical pharmacist. The medications chosen for this analysis were the top 20 medications according to the Top 200 Generic Drugs by Units in 2005 ( that were on the Wal-Mart/Target list, and in stock at the SCHC pharmacy. The SCHC filling fee scale is included on the final page of the Excel document. The limit is the cut off point at which a more expensive fee is applied to the medication. The limit is determined by the cost of the medication, and the fee is the amount added to the cost of the medication. For example, if the 340B price of a medication is $0.49, the fee added to $0.49 would be $5.75. If the 340B price of the medication is $0.51, the fee added to $0.51 would be $6.00. More expensive medications have a greater fee added to them, which increases the amount patients pay for the medication. The cost to the patient is calculated by the following equation:

(340B price of the medication / # of pills) + fee = cost to the patient

Example: Lisinopril 10 mg #100 tablets 340B price is $3.34; therefore #30 and #100 tablets would cost the patient:

($3.34/100 * 30 tablets) + $6.50 = $7.50 for 30 tablets

($3.34/100 * 100 tablets) + $7.75 = $11.10 for 100 tablets

B. Benefits and Limitations of The Wal-Mart/Target Programs on a One-Month Supply of Medication

When comparing the Wal-Mart/Target programs to SCHC’s pricing for a one-month supply of medication, the Wal-Mart/Target price is less expensive. The reason for this is the filling fee at SCHC. The filling fee starts at $5.75, and goes up as the 340B price of the medication increases. The filling fees and patient medication cost varies between the community health centers in the network, and this should be taken into account in applying this analysis. With this being said, patients will save money by getting their medications from Wal-Mart/Target if they get a one-month supply at a time. The main limitation is that the programs have a limited number of generics available; whereas, 340B pharmacies can carry more medications that are less expensive. Patients will be able to save money if they purchase all of their generic medications at a 340B pharmacy compared to getting all of them at Wal-Mart or Target, if only a portion of their medications are available on the $4 programs.

C. Benefits and Limitations of The Wal-Mart/Target Programs on a 100-Day Supply of Medication

When comparing a 100-day supply of medication on the Wal-Mart/Target programs with SCHC, there is very little benefit of the Wal-Mart/Target programs because the SCHC price is lower than all but 5 medications on the Wal-Mart program, and 4 on the Target program. The limitation of the Wal-Mart/Target programs is that patients will save money over time if they buy a 100-day supply at a 340B pharmacy. If patients buy 100 tablets of double the strength, and cut the tablets in half, they will save even more money.

D. Benefits and Limitations of the K-Mart Program

The main benefit of the K-Mart program is that there are 16 medications available that are not on the Wal-Mart/Target programs. Some of the same medications appear on both lists, but K-Mart has more dosage forms available. Limitations of the K-Mart program are: the availability of K-Mart stores throughout the network, out of the 16 medications available, 10 of these are less commonly used generics, and the cost is more than Wal-Mart/Target, $15 versus $12 for a 90-day supply.

E. Benefits and Limitations of the Rx Outreach Program

Rx Outreach has 35 medications available that are not on the Wal-Mart/Target program. Five of these medications are benzodiazepines, which have abuse potential. They do have generics available for Ortho Tri-Cyclen, Ortho-Cyclen, Zoloft, Zocor, and Prilosec. None of the other plans offer generic birth control pills. Zoloft and Zocor recently became generic, so the acquisition cost is still higher than the other generic drugs in their respective drug class; this is the reason they are not available on the Wal-Mart/Target and K-Mart programs. Generic Prilosec is not available on the other programs, probably due to the fact that patients can get it over the counter; and the retailers can make more money if it is purchased over the counter. Rx Outreach also offers extended-release forms of verapamil and diltiazem, which the other programs do not. The main limitation of the Rx Outreach program is the application process. The other 3 programs are available to all patients without an application. Some patients may not be able or willing to fill out the application. The medications are only obtainable through the mail. They can be mailed to the patient’s house, doctor’s office, or a family or friend’s address. It may be difficult for homeless patients to find a suitable address, and CHC’s might not be willing to have the medications mailed to them. Patients in need of these medications might not have $20 up front to pay for the medications.

Guidance for Patients of Community Health Center

CHC / Wal-Mart/Target / K-Mart / Rx Outreach
If patients are able to afford a 100-day supply, this is the best price. / Based on cost alone, it is the lowest price for a 30-day supply of chronic medications, or the listed quantity for acute medications. / If there is not a Wal-Mart or Target in the area, and the medication for 90-days cost more at the CHC, this is an option. / If patients require medications not on the other programs, they do not mind the application process, they have a consistent mailing address, and they have $20 to mail in with the application, this is a good option.

Guidance for Community Health Center Pharmacies and Providers

CHC / Wal-Mart/Target / K-Mart / Rx Outreach
Pharmacies can price match other pharmacies, but this can become cumbersome. Revision of the filling fee scale might be a way to be more competitive. Offer discounts to patients who qualify for the sliding fee scale. Recommend that the clinic providers write prescriptions for a 100-day supply. Most medications come packaged in 100 tablets/capsules. Offer to review the patient’s medication list to find cost saving alternatives. Combination medications can be a way to save money and increase compliance. Patients can also split tablets* to save money. Frequently check the wholesaler price for medications to see if a lower cost equivalent medicine can be obtained from a different manufacturer. / For patients who can only afford a month at a time, this is the least expensive option. If the prescription is written for more tablets than the limit amount for $4, the price will be more. Inform patients of this before they pick-up their medication. Tablet splitting is an option for some medications. Assess the abilities and probable compliance with this for patients wanting to save money. / Not a great option with their limited drug list. The price of $15 is greater than that for a 90-day supply at CHC’s. / If patients qualify for manufacturer-sponsored medication assistance programs, I would recommend this route first. The cost to the patient should be less than Rx Outreach. If the patient needs medications on this program that they cannot get on the other programs or from the CHC, this is a good option. Assist patients in filling out the paper work.

* Not all tablets can be split. Medications that are controlled-release or extended-release should generally not be split. Some tablets are not uniform in shape, and when split, may contain more or less than half of the dose. Patient’s ability to split tablets, and amount of money saved by splitting the tablets should be taken into account before recommending tablet splitting.