Superior pharmacy experience, greater cost savings
At a time of rising pharmacy costs and increasing red tape, it’s never been more important to provide a streamlined and cost-effective pharmacy experience for your employees. Kaiser Permanente’s integrated pharmacy helps lower costs at multiple touch points and works seamlessly in our members’ care experience.
From drug formulary composition to procurement to dispensing, our pharmacy is managed in-house. This gives you a transparent alternative to third-party benefit managers, who often add vendor fees, inflate specialty generic drug costs, and exclude lower-cost medications from their formularies. And your employees get an affordable, easy-to-use pharmacy experience with convenient ordering and high customer satisfaction.
Drug costs are on the rise
Since 2016, drug prices have increased around 5% each year.1 In 2024 alone, prices for over 700 medications increased.2 And while specialty medications make up less than 2% of prescriptions, they account for more than half of pharmacy spending, costing hundreds or thousands of dollars per patient per month.3 That’s why members and employers need a health care partner who delivers high-value pharmacy solutions at a lower cost.
Kaiser Permanente’s integrated pharmacy solution
We manage our entire pharmacy pipeline in-house. With no middlemen or third-party managers, our integrated pharmacies are able to pass on significant savings to members and employers. In fact, we’re expecting more than $600 million in savings in 2024 through the use of biosimilars and other cost-containment strategies.4
Convenient locations
Connected electronic health record
Better adherence
Online prescription management
Home delivery
Flexible ordering options
Find the right plan for your business. 877-305-7933
Using biosimilars to deliver value
Biologics are specialty drugs that treat chronic conditions like cancer, diabetes, and multiple sclerosis. These drugs are expensive, costing businesses up to $38,000 per year for each employee who needs them.5
Biosimilars are medications that closely mimic the biologics they’re based on. They’re made of the same materials and are prescribed at the same strength and dosage. They can also cost 50% less than the specialty drugs they mimic.6 In fact, from 2021 to 2025, biosimilars are projected to result in $38.4 billion in cost savings.7
Kaiser Permanente is an industry leader in adopting these safe, effective, and lower-cost alternatives to brand-name biologics. This strategy helps us drive down costs significantly compared to other providers. Outside of Kaiser Permanente, biosimilars are only prescribed 25% of the time.8 Kaiser Permanente has a 95% biosimilar adoption rate.9
Managing the pharmacy pipeline to minimize costs
While pharmacy benefit managers may tout rebates from manufacturer negotiations, they prioritize making a profit — not protecting your bottom line. We oversee our entire pharmacy process, which helps us control drug costs without sacrificing quality.
Our clinician-driven formulary lets providers select, test, and approve every medication, providing a wide range of safe, effective medications at a low cost.
We maintain an annual bid cycle with pharmaceutical suppliers to keep a steady supply of generic and brand-name drugs at a consistent price.
We negotiate directly with manufacturers and pass savings to our customers and their employees.
Giving employees a simpler, streamlined pharmacy experience
An easy-to-use pharmacy isn’t just convenient — it can be critical to your employees’ health. In our integrated system, doctors and pharmacists can team up with your employees to assist them with treatments, side effects, or medication adherence concerns. This collaboration has led to 96% of our members filling their prescriptions as prescribed.12Outside of Kaiser Permanente, nearly half of patients don’t take their prescribed medications as directed.13 Nonadherence may result in a decline in productivity due to increased sick days or disability.
Members can manage their own prescriptions in person, online, or through the Kaiser Permanente app, which has a 92% satisfaction rate.14 They can also get most prescriptions delivered to their door at no cost with our mail-order pharmacy.
The price of medications may be rising, but that doesn’t mean you or your employees have to absorb all the costs. Our integrated pharmacy management strategies give you a cost-saving alternative to pharmacy benefit managers — and give your employees an affordable, convenient, and connected pharmacy experience.
Find the right plan for your business. 877-305-7933
Footnotes:
1U.S. Insights: January 2024 Drug Price Changes, IDP Analytics, March 2024.
2See note 1.
3Asch and Midlam, Willis Towers Watson, March 24, 2021.
4Kaiser Permanente internal data.
5Paul Fortunato, “Specialty Drugs: Employers are Weary (and for Good Reason),” ALM Benefits Pro, June 29, 2023.
6“The U.S. Generic & Biosimilar Medicines Savings Report: September 2022,” Association for Accessible Medicines, September 2022.
7Andrew Mulcahy et al., “Projected US Savings from Biosimilars,
2021-2025,” The American Journal of Managed Care, Jul 28, 2022.8 “Biosimilars in the United States 2023–2027,” The IQVIA Institute for Human Data Science, January 31, 2023.
9Kaiser Permanente internal data.
10Kaiser Permanente internal data; “The U.S. Generic & Biosimilar Medicines Savings Report,” Association for Accessible Medicines, October 2021.
11“2020 Report: Generic Drug and Biosimilars Access and Savings in the U.S.,” Association for Accessible Medicines, 2020.
12Kaiser Permanente internal data.
13“Medicine Spending and Affordability in the U.S.,” IQVIA Institute Report, August 4, 2020.
14David Salazar, “Kaiser Permanente’s User-Focused App Redesign Makes It the 2022 Design Company of the Year,” Fast Company, September 15, 2022.