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DoD Consolidates Pharmacy Program, Improving access to the Retail Pharmacy Benefit

By Sgt. 1st Class Doug Sample
National Guard Bureau

WASHINGTON, Oct. 3, 2003 – Uniformed services personnel, retirees and family members will soon experience the benefits of a new retail pharmacy contract, according to Pentagon health affairs officials.

Dr. William Winkenwerder, assistant secretary of defense for health affairs, announced Sept. 26 that DoD's Tricare Management Activity signed a contract with Express Scripts Inc. to manage its retail pharmacy program.

The Maryland Heights, Mo., based company is one of the largest pharmacy benefits management companies in the United States, and manages DoD's Tricare mail-order pharmacy as well.

The new contract with Express Scripts will consolidate DoD's retail pharmacy program into a single national program, Winkenwerder said, allowing beneficiaries to get prescriptions filled throughout the United States, the District of Columbia, Guam, Puerto Rico and the U.S. Virgin Islands at some 55,000 local retail pharmacies.

"This will make it easier for beneficiaries to get their prescriptions across the United States irrespective of where they live," he said. "It will improve customer satisfaction, and it will save money for the government. We have a good program now, (and) this change is going to make it an even better program."

Winkenwerder said the new contract, which is scheduled to begin prescription services on April 1, 2004, is expected to save the Defense Department close to $2 billion in prescription costs over the next five years. "All of this in one way or another accrues back to the taxpayer and our beneficiaries," he added.

Express Scripts will provide the retail pharmacy network; services for claims processing, drug utilization and safety review, and prior authorization; beneficiary communication materials; and a call center to handle customer questions.

"Our expectation is for a seamless transition, one in which our customers, our beneficiaries, see little or no change in the way they get their prescriptions. If anything, I hope they will see an improvement soon after the transition, because we're adding pharmacies to the network, thus improving access."

The contract includes a six-month base period for transition activities that began Oct. 1, and 5 one-year options for prescription services beginning April 1, Winkenwerder said. The total value of the contract, which does not include the cost of prescriptions paid with DoD funds, is estimated to be $245.4 million.

According to the Express Scripts Web site, the company has more than 50 million members in the U.S. and Canada, and provides its members with access to a network of more than 55,000 pharmacies, mail-order prescription services and an online pharmacy. The company processes more than 380 million prescriptions each year and its customers include HMOs and other health insurers, self-insured businesses and union benefits plans.

"This new contract is part of the department's strategy to implement a fully integrated pharmacy program that delivers world-class, cost-effective patient care through a single manager of our retail pharmacy benefit," Winkenwerder said.

"Our new contract partner will apply best pharmacy benefit management practices to improve and continue the delivery of this important service," he added, "while achieving the highest level of beneficiary satisfaction."

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