Preferred and Performance Networks
PREFERRED NETWORKS
Payers put together a network of preferred pharmacies to serve their patients. Inclusion as a "preferred" pharmacy is largely based on willingness to accept lower reimbursement levels (drug and dispensing fees). Preferred networks use co-pay differentials to steer patients to selected pharmacies.
PERFORMANCE NETWORKS
Preferred networks are now migrating towards performance networks, which base pharmacy inclusion on reimbursement levels AND on the ability to meet or exceed performance goals related to adherence and other clinical measures.
Similar to preferred networks, plans use co-pay differentials to guide patients to high performing pharmacies.
WHY ARE PERFORMANCE NETWORKS IMPORTANT TO PHARMACIES?
- The pharmacy's biggest "customer" is actually now payers: Approximately 90% of all prescriptions are paid with insurance vs. 10% cash
- Insurance plans are dominated by preferred networks. Plans are now moving from preferred networks to performance based networks.
- Star ratings will further lead to service level agreements that drive the building of performance networks
- Access to lives: Performance on pharmacy quality measures will be a factor in determining inclusion in preferred networks and may impact access to lives