Walgreens and Express Script, A Case of He Said She Said?

This post brought to you by Walgreens. All opinions are 100% mine.

The Walgreens and Express Script contract negotiations were among the top New Year headlines. Over the last year Walgreens has been in negotiations with Express Scripts in an effort to continue as part of its pharmacy provider network. The contract expired on Dec. 31, 2010 forcing long standing Walgreens customers, whose insurance network included the Express Scripts pharmacy plan, to go elsewhere. This includes Walgreens pharmacies nationwide and the Duane Reade pharmacies in the New York City area.

The negotiation breakdown resulted in the seedy He Said, She Said type of finger pointing. Reuters quoted Kermit Crawford, president of pharmacy, health and wellness solutions, “Walgreen asserts Express Scripts is focused only on drug spending and “that’s not how we think about healthcare.”

The Reuters article went on to say Express Scripts is in the process of trying to buy Medco, a deal that awaits regulatory clearance. Chief Financial Officer Jeff Hall said “We think cost has to go down. Walgreens thinks flat is good enough.”  What Express Script failed to mention was the length of time. Evidently an offer from Walgreen for a three year flat rate wasn’t cost effective enough for the network managing company. Yes, Express Script is the manager for the insurance company, group, or employer, the middle man.

An Excerpt from the Chicago Tribune:

So far, the company (Walgreen) has been able to keep more than 120 of those corporate and health plan customers and remains in “active negotiations with many more,” said Walgreen CEO Greg Wasson.

Pharmacy benefits managers typically market their services and attempt to secure contracts with employers and health plans each spring and summer.

Wasson said several other pharmacy benefits managers are seeking “deeper, more preferred relationships with Walgreens in order to compete with Express Scripts … and we intend to help them win.”

The company, he said at the annual meeting, is focused on the future.

 

He Said, She Said, nothing more than money vs. patient benefit battle. I find this entire breakdown in negotiations very unproductive and quite disgusting! As consumers we must sift through the media reports and decide what to believe.  Walgreens has been a reliable neighborhood pharmacy in my community for more than 25 years. I don’t believe they strive for rising costs or network changes with no regard for their customers.

Wall Street Journal reported earlier this month, “In recent days, we are hearing more and more from our customers and patients that they are upset about losing access to Walgreens pharmacies as a result of Express Scripts’ actions,” Walgreen President and Chief Executive Greg Wasson said in a press release.

This sounds much more like reality in my opinion. And Walgreens stepped up for it’s customers as well by offering a prescription drug savings plan. On the contrary, most reports claim no savings were passed on to Express Script customers as a result of this split.

Walgreens Savings Plan eases the burden of switching pharmacies for many long time customers. The Walgreens Prescription Savings Club includes the following benefits:

  1. Currently 2 million members enrolled
  2. Prescription Savings Club membership is risk free. If savings above the cost of membership are not achieved, they will refund the difference.
  3. For $10.00 a year, a family membership covers everyone in the immediate family, including a spouse, dependents 22 and younger and pets. Individuals may join for $5.00.
  4. Savings on more than 8,000 brand-name and all generic medications
  5. Discounts on flu shots, pet prescriptions, nebulizers, and diabetic supplies
  6. Bonuses when you purchase Walgreens brand products

Our health insurance desperately needs simplifying to increase the quality of patient care while keeping it affordable. The middle man that has become so prevalent ultimately diminishes quality and increases costs. Kudos to Walgreens for rallying direct contracts with other companies!

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