by Dennis M. Sponer, President/CEO, ScripNet

Pharmacy expenditures in the United States totaled approximately $237 billion in 2007, increasing at an annual rate that far outpaces the rate of inflation, according to the Journal of Health Affairs. This directly impacts the cost of workers’ compensation drug coverage offered by public and private self-insured employers, unions, and third-party administrators.

SORM uses ScripNet’s pharmacy benefit management (PBM) services. ScripNet offers SORM’s client agencies and their employees an electronic pharmacy network (including 3,468 pharmacies in Texas and more than 63,000 pharmacies nationwide), mail order pharmacy services, a live help desk, and a drug utilization review program that increases efficiencies and lowers costs, while improving customer service for the state’s injured workers. ScripNet’s automation of pharmacy claims has enabled SORM to more effectively manage workers’ compensation pharmacy benefits, helping to curb pharmacy price increases and excess medical utilization and control medical spending.

SORM recently awarded a contract to ScripNet to provide PBM services for its workers’ compensation program for the next five years.

“SORM utilized a comprehensive competitive bid process to select ScripNet as its vendor,” Executive Director Jonathan D. Bow said. “The formal RFP (request for proposal) process helped SORM select the vendor that was capable of providing the highest quality services to injured workers, at competitive prices, and with improved outcomes consistent with SORM’s business requirements.”

ScripNet’s President Dennis Sponer said SORM’s client agencies save up to 30 percent on “hard” drug costs through network discounts, which are below state-mandated fee schedules. “But SORM is achieving an additional 20% to 30% in ‘soft’ savings through the management services offered on top of those discounts, by getting consumers to shop in-network, accepting generics when available, minimizing misuse, and streamlining the communication and claims administration processes,” Sponer said.

ScripNet helps SORM manage costs by:

• Negotiating discounted prices with pharmacies;
• Encouraging the use of generic drugs rather than brand medications, when medically appropriate;
• Establishing formularies, which provide guidelines for which drugs are most appropriate for specific medical conditions;
• Establishing retail pharmacy electronic data interchange networks with online decision support tools and enable real-time communication to authorize, adjudicate, and process claims between pharmacies and carriers; and
• Administrating drug utilization reviews to encourage appropriate drug use.

Benefits of Claims Automation
For injured employees, ScripNet’s automation makes the process easier, faster, and safer, eliminating questions and delays at the pharmacy. Employees are also more likely to get the correct medications within an approved formulary. If they prefer mail order prescriptions, the PBM expedites that process.

For SORM, ScripNet’s automated services virtually eliminate last-minute calls seeking claims authorization. When injured workers utilize an in-network pharmacy, SORM agencies save an average of 14 percent on brand medications and 38 percent on generics.

Dennis Sponer is CEO of ScripNet, one of the fastest-growing PBM companies in North America, providing PBM services to more than 2 million employees through pharmacies in all 50 states. Inc. magazine has included ScripNet three times on its annual listing of the 500 fastest-growing privately held companies in the nation.