Improving health through affordable medication

CVS Caremark is lowering drug prices by negotiating with manufacturers, championing transparency, and meeting people where they are.

More than one-half of Americans struggle to afford their prescription drugs, which means millions of people aren’t taking their medications as prescribed. This inability to take recommended treatments as intended can result in a cascade of preventable hospitalizations and complications, tacking on an additional $100 billion to the U.S.’s already staggering annual health care costs.

“Access to affordable prescription drugs is a life-or-death matter for many Americans.” says Dr. Michelle Gourdine, chief medical officer at CVS Caremark, the pharmacy benefit management (PBM) subsidiary of CVS Health. “We’ve got great technology and innovation in the pharmaceutical sector to help people manage, treat, and live with their chronic conditions—or even cure them. Yet, unaffordable prescription drugs keep some people from living their healthiest lives.”

Gourdine, a former pediatrician and hospital system executive, says those high stakes drive the CVS Caremark team to lower costs and improve access by tackling the affordability issue on multiple fronts.

Negotiating with manufacturers

For more than two decades, CVS Caremark has been offering services to a variety of clients, including insurance companies, corporations, and federal and state agencies. Today, CVS Caremark provides pharmacy benefits to around 90 million Americans.

CVS Caremark negotiates with drug manufacturers on behalf of the PBM’s clients for lower prices on prescription medications. The goal of these efforts is to make it more affordable for clients to cover prescription drugs as part of the health insurance benefits they provide to their members. The proof of the company’s effectiveness is in the savings. The average CVS Caremark member pays just $7.26 in out-of-pocket costs for a 30-day supply of medication. More than 90% of the prescriptions that CVS Caremark fills are for generic drugs.

“While the PBM narrative tends to focus on the financial, which is vitally important, we also make sure that the medications people have access to are safe, appropriate, and effective in delivering better health outcomes” says Gourdine. Even before a new prescription drug is approved by the U.S. Food and Drug Administration, the CVS Caremark team of more than 200 physicians and pharmacists takes a deep dive into the science and clinical trials to ensure the medication is a good choice for its members. 

Championing price transparency 

CVS Caremark recently launched TrueCost, an innovative drug pricing strategy that is designed to boost drug price transparency for its clients and their members.

“It is our way of saying, ‘We hear you,’” says Gourdine. “We hear from clients. We hear from the public. We hear from elected officials that there needs to be more transparency in pricing.” 

TrueCost will enable CVS Caremark clients to get a clearer picture of their prescription costs by providing greater pricing transparency through drug-level and net-cost pricing guarantees. TrueCost will reduce pricing disparities and help members realize the maximum value of CVS Caremark’s purchasing power, so they can take full advantage of their benefit. And when they stay on benefit, they get a connected experience with digital tools and clinical support, helping to improve their health outcomes.

“The goal is to be more transparent to our clients about the prices they’re paying for each individual medication,” Gourdine says, “We know that aggregate pricing of brand and generic drugs doesn't always reflect our drug-level purchasing power. With TrueCost, we guarantee the value for each to provide more transparency.”

Addressing equity and access

While CVS Health’s commitment to community health spans many formats, it starts with its physical presence. The majority (85%) of Americans live within 10 miles of a CVS store. “Customers rely on us and trust us, and we take that very seriously,” Gourdine says.

The company has also taken steps to help vulnerable populations. Older adults—those ages 65 and up—are more likely to have two or more chronic health conditions, often requiring prescription medication. Through its acquisition of Oak Street Health last year, CVS Health now has a primary care provider focused on older adults. This gives the company additional insight into the demographic’s unique pharmacy needs, allowing CVS Caremark to continually evaluate its offerings to meet them.

Signify Health, which brings in-home and virtual health consultations to vulnerable older adults, is another part of CVS Health. Its clinicians help patients understand their health, answering questions and reviewing medications. They can also help determine whether other services, such as case management, can help support patients as they manage their medications.

To further connect communities to care, CVS Health also offers mobile health care in some underserved communities through Project Health. At mobile health events, people can access free biometric screenings and get connected to local resources that can help them manage their health.

“At CVS Health, we are continually evaluating the offerings that we have to make sure that they are meeting the needs of those we serve,” says Gourdine. “We believe that our role is to ensure that people get the care that they need to stay healthy.”