CVS Caremark's new plan design eliminates cost-sharing for diabetes drugs 

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Caremark is launching a new plan design that cuts cost-sharing for diabetes drugs. (Pixabay)

CVS Caremark is rolling out a new option to allow employers or plan sponsors to eliminate members' out-of-pocket costs for diabetes medications, in part, by steering them to lower-priced generics.

The RxZERO design for pharmacy plans allows sponsors to cover all costs associated with medications for diabetes, including those for Type 2 diabetes, while lowering overall costs for the plan sponsor and avoiding premium increases, CVS Health said in an announcement

Efforts to reduce cost-sharing have traditionally focused on insulin, which is crucial for people with Type 1 diabetes, CVS said. But RxZERO extends that approach to other drugs used for controlling and managing diabetes among those with Type 2 diabetes, which accounts for 95% of cases. 

Caremark estimates that members taking branded diabetes drugs spend on average $467.24 per year, with 12% spending more than $1,000 per year. 

But plan sponsors can offset the additional costs in two ways, Caremark said. For one, a more value-driven formulary design can save $170 per member per year by encouraging greater use of generic drugs and preferred branded medications. 

In addition, CVS said that employers and plan sponsors can see significant cost savings by improved medication adherence. Members enrolled in high-deductible plans face the highest out-of-pocket spending, which can promote nonadherence, Caremark said. Caremark found that for each diabetic member who went from nonadherence to adherence to their medications, clients saved $2,202 each year on health costs, or $156 per member. 

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“Eliminating out-of-pocket costs for diabetes medications ensures long-term affordability, improves adherence, and most importantly, puts patients on the path to better health,” said Troy Brennan, M.D., chief medical officer at CVS, in a statement.

“A person living with diabetes is required to take many tasks to manage their condition annually,” Brennan said. “Unfortunately, that can include making difficult decisions about whether they can afford their medications and fill their prescriptions.” 

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Caremark operates the Transform Diabetes Care (TDC) model—a managed care program for plan sponsors prevents costs associated with prediabetes and hypertension—which provides remote monitoring support, personalized guidance and local interventions that are designed to assist payer clients in managing diabetes, a complex and costly chronic illness. Caremark sees the RxZERO solution as a complementary way to help payers and employers get their arms around the costs associated with diabetes. 

CVS also provides care management services to members at its MinuteClinics, including assistance with necessary lifestyle changes and providing guidance on appropriate medications.