News

Article

Optum Rx Reveals New Pricing Model for More Predictability, Transparency

Author(s):

A new program from Optum Rx would offer greater predictability by using a guarantee-based pricing model.

Cash money stethoscope cost | Image credit: adragan - stock.adobe.com

Optum Rx's new Clear Trend Guarantee program is a guarantee-based pricing model that will provide more predictability and transparency for drug prices.

Image credit: adragan - stock.adobe.com

Optum Rx announced a new value-based pricing model with an emphasis on predictability and transparency.1 When the Clear Trend Guarantee program launches January 1, 2025, it will combine guarantees into a single per-member cost.

The new program is a value-based model with shared savings, according to Optum Rx, which is the pharmacy benefit manager (PBM) of UnitedHealthcare. It is a guarantee-based pricing model combining retail, home delivery, specialty drug, and rebate components into a per-member guarantee.

“It is more important now than ever before to be an innovator in health care and to drive affordability and value for plan sponsors and members,” Patrick Conway, MD, CEO of OptumRx, said in a statement. “We are not stopping with Clear Trend Guarantee, and will continue to deliver clear information, transparent and lowest net cost, choice, and a simplified pharmacy benefit for everyone.”1

The Clear Trend Guarantee program is part of Optum Rx’s Cost Made Clear solutions, which includes Cost Clarity, a model that bases costs on independent cost baselines, and Cost Advantage, a pass-through model using average ingredient costs and reflecting real-time network price improvements.2

The announcement is part of a wave of changes from insurers to offer more transparency in drug pricing.3,4 At the end of 2023, CVS Health introduced CostVantage, which sets costs using a formula based on the drug cost, a set markup, and a fee for pharmacy services. TrueCost from CVS offers client pricing reflecting the true net cost of prescription drugs with a transparent look at administrative fees.

Meanwhile, Express Scripts, a subsidiary of Cigna, announced ClearNetwork, a cost-plus pricing model that charges a “straight-forward estimated acquisition cost” and a small markup for pharmacy dispensing and service costs.3,5

These announcements come while PBMs are in the spotlight for their lack of transparency. There have been growing calls for years for PBM reform. At the Community Oncology Alliance Community Oncology Conference, speakers said there are real prospects for PBM reform this year, even with the “lame duck” session after Election Day.6

Congress first turned its attention to PBMs in March 2020, just as everything shut down due to COVID-19, and attention has been on PBMs ever since.7 Senate Finance Committee Chair Ron Wyden (D, Oregon) and Ranking Member Mike Crapo (R, Idaho) have been leading bipartisan efforts to pass PBM reforms to crack down on “their shadowy tactics” that drive up drug costs.8

“Certain pharmacy benefit manager practices continue to jeopardize the viability and financial stability of pharmacies, forcing far too many to close up shop,” Crapo said in a statement.8 “Congress must pass our comprehensive, bipartisan legislation to reduce out-of-pocket medication costs for seniors, enhance federal oversight, and shore up patients’ access to the pharmacy of their choice.”

Bipartisan legislation was first introduced in Congress in 2023. In addition, and in March 2024, Wyden and Crapo renewed their call to pass the legislation. Their legislation has support from pharmacy advocates, including the National Association of Chain Drug Stores (NACDS) and the National Community Pharmacists Association.

"PBM profits are soaring while they make patients pay more for their medicine and make it impossible for pharmacies of any size to stay open,” said Steven C. Anderson, president and CEO of NACDS.8 “It's time for Congress to pass real PBM reform, particularly for Americans in Medicare and Medicaid. Patients and the pharmacies that serve them can no longer wait. It's time to get this done." 

References

1. Optum Rx announces new pricing model to offer clients another transparent, predictable way to manage drug trend. News release. UnitedHealth Group. May 20, 2024. Accessed May 21, 2024. https://www.unitedhealthgroup.com/newsroom/posts/2024/2024-05-optum-rx-clear-trend-guarantee.html

2. New Optum Rx payment solutions continue to empower clients with more choice, transparency in pharmacy benefits. News release. UnitedHealth Group. April 24, 2023. Accessed May 21, 2024. https://www.unitedhealthgroup.com/newsroom/posts/2023/2023-04-24-optum-rx-enhancements-preserving-choice.html

3. Joszt L. CVS announces more transparent model for pharmacy reimbursement, drug costs. AJMC®. December 5, 2023. Accessed May 21, 2024. https://www.ajmc.com/view/cvs-announces-more-transparent-model-for-pharmacy-reimbursement-drug-costs

4. CVS Health highlights path to accelerating long-term growth through building a world of health around every consumer. News release. CVS Health. December 5, 2023. Accessed May 21, 2204. https://www.cvshealth.com/news/company-news/our-path-to-accelerating-long-term-growth.html

5. Express Scripts introduces new option to give clients maximum simplicity in drug pricing. News release. PR Newswire. November 14, 2023. Accessed May 21, 2024. https://www.prnewswire.com/news-releases/express-scripts-introduces-new-option-to-give-clients-maximum-simplicity-in-drug-pricing-301986745.html

6. Caffrey M. Change Healthcare could get Congress’ attention before break for election. AJMC. April 6, 2024. Accessed May 21, 2024. https://www.ajmc.com/view/change-healthcare-could-get-congress-attention-before-break-for-election

7. Caffrey M. Oncology practices keep pace with PBMs, in court and beyond. AJMC. April 5, 2024. Accessed May 21, 2024. https://www.ajmc.com/view/oncology-practices-keep-pace-with-pbms-in-court-and-beyond

8. Wyden, Crapo call for swift passage of bipartisan PBM reforms. News release. US Senate Committee on Finance. March 14, 2024. Accessed May 21, 2024. https://www.finance.senate.gov/chairmans-news/wyden-crapo-call-for-swift-passage-of-bipartisan-pbm-reforms

Related Videos
Tycel Phillips, MS, City of Hope
Ali Khawar
Kimberly Westrich, MA, chief strategy officer of the National Pharmaceutical Council
ISPOR 2024 Recap
Julie Patterson, PharmD, PhD
William Padula, PhD, MSc, MS, assistant professor of pharmaceutical and health economics, University of California Alfred E. Mann School of Pharmacy and Pharmaceutical Sciences
Neil Goldfarb, CEO, Greater Philadelphia Business Coalition on Health
Screenshot of Mary Dunn, MSN, NP-C, OCN, RN, during a video interview
Inma Hernandez, PharmD, PhD, professor at the University of California, San Diego Skaggs School of Pharmacy and Pharmaceutical Sciences
Screenshot of Fran Gregory, PharmD, MBA, during a video interview
Related Content
CH LogoCenter for Biosimilars Logo