Concurrent with the clinical review, the Provider Synergies financial team solicits and negotiates rebate offers from pharmaceutical manufacturers with drug products in the Therapeutic Drug Class being reviewed. A combined PDL and rebate program will save significantly more money than a program without a rebate component. Given that a group of medications is clinically equivalent, rebates can greatly reduce the cost of therapy within a therapeutic class. Although savings can be realized from movement to lower AWP products within a therapeutic class, the majority of savings associated with a PDL program are achieved through a rebate program.
Provider Synergies contracts directly with the manufacturers. In the case of our State Medicaid clients, we contract on behalf of the State agency. For most of our clients, we have negotiated with over 70 manufacturers in the development of their rebate programs.
The rebate contracting process used by Provider Synergies has been shown to significantly reduce the pharmaceutical expenditures of our clients. These clients have realized a lower net-net cost per prescription as a result of pharmaceutical rebates as well as market shifts to less costly agents. Provider Synergies has extensive experience in negotiating discounts of various types including rebate contracting for Health Maintenance Organizations (HMOs) and managed care plans, chargeback contracting for mail-order pharmacies and supplemental rebate contracting for state Medicaid agencies. We have negotiated contracts that address unique client needs, including shifting risk to the manufacturer in the form of dosage caps, allocating value derived from disease management programs back to product cost and providing variable rebates based on step care therapy edits, to name a few.
Unlike many other Preferred Drug List management companies, Provider Synergies calculates each client's rebates separately from our other clients. This ensures that each client's rebates will not be negatively affected by another plan's utilization and allows our clients to have a greater understanding of utilization trends and opportunities.
The inclusion of rebates provides an equal opportunity for all manufacturers to offer their drug products to the State or client at competitive prices. Relative costs are based on the net-net cost of each agent, which is calculated by subtracting total rebates from the state or client's claims costs. This is a more realistic and consistent approach to cost comparison and savings achievement than many of the other cost models in use.