Implementing a mandatory generic policy on ASO accounts

Mandatory generic policies save people money. Often, however, large Administrative Services Only (ASO) accounts are hesitant to switch their members to a mandatory generic policy because of the perceived negative impact that it may have on plan members.

“It’s abundantly clear that a mandatory generic policy is really the only way to go,” declared Shanta Zurock, the drug benefit manager, clinical drug services, at Alberta Blue Cross.

At the symposium, Zurock shared the collective experiences of one or two large groups who have made the decision to implement a mandatory generic policy. She explained that, while plan sponsors sometimes perceive significant barriers to implementing a mandatory generic policy, the experiences of groups who have gone before can suggest solutions to challenges as they present themselves.

“We do move ahead with mandatory generic as often as we can with our plan sponsors,” said Zurock. “It’s not as big a step as plan sponsors sometimes make it out to be. It’s doable and it’s doable with very little employee upset. But we do need to make sure that we are addressing all of everybody’s concerns: both their logical and emotional concerns.”

She pointed out that open plan designs with no drug plan management features of any sort are still prevalent in the Canadian marketplace, and many of these are ASO accounts. ASOs, however, are involved in drug plan management decisions.

“They consciously decide whether or not to add cost-saving measures to their plans. They have internal benefit expertise and knowledge. They have customized drug plans that are usually designed to meet their own unique corporate initiatives and goals, and, they want high service levels from their drug plan managers. So we can present a compelling case for generic substitution.

Plan sponsors sometimes mention perceived barriers, such as union contracts, communication challenges and member attitudes towards generics. Plan members may equate a mandatory generic policy with a reduction in services and personal choice, and as interference in the doctor-patient prescribing encounter. The key is to work on achieving buy-in from both the plan’s members and sponsors by showing them that a mandatory generic program is an enhancement to the drug benefits, not a restriction, Zurock recommended.

She reported that Alberta Blue Cross customized a mandatory generic substitution program for a plan sponsor. The sponsor switched from a “Cadillac” drug plan to a managed one that included a mandatory generic substitution program. Later, analysis showed how the program had achieved substantial cost savings for the plan sponsor and plan members but that both the plan sponsor and members still questioned the program’s value, quoting various myths and disparaging media articles about generics.

Alberta Blue Cross learned the importance of getting buy-in from plan sponsors and members, and never to dismiss people’s emotional arguments about generics, said Zurock. It’s critical to avoid appearing paternalistic or condescending in communications with employers and plan members, she stressed, adding that it’s always important to explain clearly what mandatory generic substitution means, and how it works.

“Converting 100% of our ASO accounts might not be possible, but communicating with 100% of our ASO accounts is definitely possible,” she stated. “We have to stay the course. We will keep going out with the same messaging: ‘Generic substitution is good for plan sustainability, and the cost savings that are achieved can be translated into greater benefits in other areas.’”