Accounting Basics
Amount paid by the patient – acquisition cost of drugs
What is margin
ASP
What is Average Sales Price
Program where drug companies offer certain free drugs to low-income patients who lack prescription drug coverage and/or meet certain criteria
What is Patient assistance programs
Prescription Drug Coverage
What is Part D
Largest payer of prescription drug benefits
What is Medicare
Total revenue – total expenses (ie. Cost of drugs and other expenses)
What is net profit
AMP
What is Average Manufacturer Price
Requires the prescriber to receive preapproval from the PBM in order for the drug to be covered by the pharmacy benefit
What is Prior Authorization
Medical Insurance
What is Part B
Age which patients qualify for Medicare if they don't meet other requirements
What is 65 years old
All costs associated with treating particular condition including medications
What is prospective payment
WAC
What is Wholesale Acquisition Cost
Type of private health insurance or healthcare organization that is based on networks of providers, such as pharmacies, doctors, and hospitals.
What is Managed care
Medicare Advantage Plans
What is Part C
October 15 through December 7 of any year
What is open enrollment
The cost-sharing amount that the patient or customer pays
What is Copayment (aka copay)
AWP
What is Average Wholesale Price
Payer that covers the elderly, disabled, and people with end-stage renal disease (ESRD) or amytrophic lateral sclerosis (also known as Lou Gehrig’s disease or ALS)
What is Medicare
Hospital Insurance
What is Part A
A period of reduced coverage that typically occurs once the individual’s total prescription rug spending for the year reaches the initial coverage limit
What is coverage gap aka “donut hole”
Third-party reimbursement=
What is (ingredient cost + dispensing fee)- copayment
Also known as the sticker price of a drug that the pharmacy sells to a patient or third party payer
What is AWP
Offers more choices of physicians and hospitals, but the employee’s out of pocket costs are higher than with managed care plans.
What is Indemnity insurance
Covers diabetic testing supplies and some other products
What is Part B
There are six categories of drugs that must include almost all drugs in the category because of the importance of the therapeutic class and needs for beneficiaries to have access to all the drugs in the class
What is Antipsychotics, antidepressants, antiepileptics, immunosuppressants, cancer, and HIV/AIDS drugs