It’s Beginning to Look a Lot Like … A Change for the Worse: ESI vs. Walgreens

Submitted by US Navy Veteran

If you like the quality of pharmacy service and choices that TRICARE provides to veterans, don’t get too comfortable with it. It’s beginning to look like that will all change at the start of the year – and not for the better.

Through the end of 2011, Walgreens will provide pharmacy services as part of DOD’s TRICARE pharmacy program. But come January 1st, that will disappear because Express Scripts, Inc. (ESI), the company that manages the service, has a contract dispute with Walgreens and will not negotiate a settlement.

Actually, they will negotiate: my-way-or-the-highway is basically their position.

Walgreens is the largest pharmacy chain in the country. They serve 40 million consumers every week through nearly 8,000 stores nationwide. They have more stores that are open 24 – 7 than any other pharmacy network. And 70% of the U.S. population lives within five miles of a Walgreens.

However, after the first of the year, we won’t have access to that network or services.

Because ESI manages the Defense Department’s TRICARE pharmacy benefit, Walgreens offered a separate contract guaranteeing its prices would match or beat the average costs per prescription with all other retail pharmacies. The company has also committed to keeping the cost per Medicare prescription flat for the next four years. Such cost containment measures could be a real boon to the Federal government, as well as control the prices consumers pay.

Unfortunately, not only has ESI ignored or rejected these proposals, but it has also demanded unacceptable rates and terms from Walgreens. For example, they have demanded rates that are below the average industry cost to fill prescriptions. They also want to dictate which drugs are generic and which are not.

ESI has claimed Walgreens wants to increase prescription reimbursement costs by 20 percent. That is pure malarkey. Walgreens has offered ESI a number of cost-savings that would, in effect, hold the average prescription reimbursement cost increases to less than two percent annually over the course of the three year contract.

In an open letter to vets and active duty military, Walgreens’ CEO said, “We do not wish for military beneficiaries to be ‘in the middle’ of this issue.” Well, we are. Meanwhile, Express Scripts has rejected all efforts to reach an agreement that would keep Walgreens in the TRICARE network of pharmacies.

What can we do about this? Make noise. Register an opinion. Let DOD and Express Scripts know how you feel. Here’s a link to a page where you can sign a petition to do just that:

You can also send a letter to your Senator and Member of Congress, letting them know you value the convenience of having a Walgreens nearby. Another point to make is that Walgreens is working to keep prices as low as possible. With Walgreens gone, Express Scripts will be much freer to set prices that benefit them, not us.

Walgreens is doing all it can to keep serving us as customers. It only seems right that we return the favor.