Health Care

Try Jim Cramer's Action Alerts PLUS
CLICK HERE NOW

Health Care Advocates' Pricing Pushback

03/23/06 - 07:04 AM EST

Melissa Davis

"One of the folks from that PBM testified against the bill in Colorado," Treat says. "He said, 'Then everyone will have to do things the way that we do them -- and we'll lose our competitive edge!'"

To be sure, transparent PBMs have discovered a clear demand for their services. One of them, known as Navitus, actually started from scratch when the state of Wisconsin came calling. Navitus CEO Allan Zimmerman says that Wisconsin was seeking a new PBM that would pass through all of its drug savings in exchange for a simple administrative fee.

Since then, Zimmerman says, Navitus has not only met Wisconsin's drug-spending targets but has actually come in under budget -- by at least $25 million -- two years in a row. Clearly, he says, the company's full-disclosure model has not hurt its ability to bring about savings for its customers.

Looking forward, Zimmerman sees his company's own model -- rather than that embraced by larger players -- as the real wave of the future.

"I think the big PBMs will continue to survive," he says. "However, I think there will be an ongoing erosion of their base over time. ... If you fast-forward 10 years, I would say that transparency will be the predominant model in the PBM industry."

'Shopping Patient'

Though young, Trapier Michael has been waiting for some time for transparency to rule the day.

Beginning at age 12, Trapier found himself shifting from one doctor to another in search of an effective treatment for his bone and cartilage disorder. Ten years -- and eight surgeries -- later, he finally found it.

"I wound up at Duke, and they fixed me up," Michael says. "I was a shopping patient -- against great odds. There wasn't a good way back then ... [And] it's still not easy to be a health care shopper today."

Michael is doing his part to change all of that. Now 23, he will soon enter the master's program in health policy and management at Harvard Medical School. In the meantime, he recently launched his own Internet blog focused specifically on consumer-driven health care.

Michael says the site, just a few weeks old, already attracts hundreds of visitors a day.

"People are very passionate about the subject," he says. "Everybody wants the same thing -- better health care for more people. ... I see major changes from a decade ago, so I see them in the future, too. In fact, I see them happening right now."

1 2 3 4 5
» Next

Previous Story

Abbott Names New Chief

Health Care


03/21/06
Abbott Names New Chief

Richard Gonzalez takes over for Jeffrey Leiden.


03/21/06
Creaky Quarter at Biomet

The stock falls as the top line comes in short.


03/20/06
HMA Changes Its Tune

The once-acquisitive hospital chain now just wants to get well.


08/05/08
Three Internet Stocks That Could Double

These forgotten Internet stocks are being accumulated by hedge funds.


08/15/08
The Five Dumbest Things on Wall Street

Raspberries for Apple; You'll be sorry, UBS; Fortress or Fort Knox? Wholly unappetizing Foods; give Liberty AOL or give them...


08/15/08
McCain Fund-Raising Picks Up

The GOP presidential candidate raised $27 million in July.


08/15/08
Cash-Back Cards Aren't Money in the Bank

Some credit and debit cards give you some cash back on purchases. But you need to manage it well to benefit from it.


Your Recent Quotes: Quote Up0 | Quote Down0
Dow S&P 500 NASDAQ
Oil*
Gold
10 Yr
0.00%
%
%
%
Data delayed 20 min
Sign up for our FREE newsletters now. See All

  • Cramer's Daily Booyah!
  • Before the Bell

Premium Stock Ideas
Access Action Alerts Plus to find out Cramer’s latest picks now!