How PBMs Manipulate MAC Lists

Generic Drugs: How PBMs Manipulate MAC Lists

How PBMs Manipulate MAC ListsThe price Maximum Allowable Cost (MAC) list is one of the understated details in pharmacy benefit manager (PBM) contracts. In 2008, a national survey reported that 92% of employers have a MAC price list in place through their PBM.

MAC Price in Your PBM Contract

Crystal Clear RX, a consulting company in the pharmacy benefit industry, says that knowledge of the details of the PBM contract such as the MAC prices affects your bottom line.

MAC prices are the upper limits that a plan will pay for generic drugs and brand drugs with generic versions, or also known as multi-source brands. The generic drugs often have a range of Average Wholesale Prices (AWPs), and the MAC prices needed to reconcile the differences between an inflated AWP and the price the pharmacy actually pays.

Factors in MAC Price Listing

Many PBMs maintain multiple MAC lists and each has a different number of drugs and pricing. No two MAC price lists are alike because every PBM tends to pick and choose products for their MAC lists using different criteria. In a well-run MAC program, pharmacies will receive a reasonable margin to prompt the use of generics, wherever possible. The problem comes when an employer does not know what drugs fall under a MAC list.

PBMs decide based on the supply of the product, where to get its supply, and its FDA rate. They also consider whether there is a marketable discount difference between price per unit against what could be captured through an AWP discount prices between generic and branded products, and the clinical implications of substituting generic products with the branded ones. This causes significant differences in pricing and heavily affects the employer’s pharmacy spend.

Plan Sponsors Should Take Proactive Actions

Plan sponsors should ask if the PBM is using the same MAC list as their network pharmacies and if the PBM use the same retail and mail service pricing. A copy of the MAC lists should be provided to the plan sponsors. They should also be in the position to demand every bit of value possible from their PBMs.

Monitoring MACs price lists may signal a big turnaround in an employer’s bottom line. With the help of a consulting company experienced in the PBM industry, you can optimize your PBM contracts and get the value you signed and are paying for.

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