An unusual partnership between pharmacy-benefit manager Express Scripts and the new hospital alliance APS Healthcare is moving ahead.
The agreement demonstrates the growing complexity of relationships between hospitals and vendors. Under a new contract, Express Scripts is a preferred supplier of management services, a purchasing partner and a potential investment for APS (Oct. 2, 1995, p. 10).
As of mid-January, Express Scripts was to take over as pharmacy-benefit manager for three APS members: Harris Methodist Health System, Fort Worth, Texas; Lutheran Health Plans, Fargo, N.D.; and Methodist Health Systems, Memphis, Tenn. The firm was discussing ventures with other APS members, as well, said Barrett Toan, its president and chief executive officer.
Express Scripts, based in St. Louis, manages pharmacy benefits for health plans and employers. Its contracts cover more than 8 million people.
APS, an alliance of 1,700 hospitals, was formed from the merger of American Healthcare Systems, Premier Health Alliance and SunHealth Alliance. It operates offices in Charlotte, N.C.; San Diego; Washington; and Westchester, Ill. AmHS was the original party in the Express Scripts agreement.
APS and Express Scripts now are developing joint formularies for inpatient and outpatient drugs, Toan said. Although the companies have separate purchasing contracts, they will negotiate jointly with drug manufacturers to make the most of their more than $6 billion in pharmacy contract purchases, he said.
The agreement sets up Express Scripts stock as an incentive for contract use. It also gives APS an option to buy half of Practice Patterns Science. The Express Scripts subsidiary has developed methods to track expenditures for individuals with certain diseases.
Both Premier and SunHealth have related programs, so "we are expecting that there is going to be good coordination," Toan said.