Drug/pay flow

Question 1

Amp stands for….

Answer 1

average manufacturer price

Question 2

Amp is the price…..

Answer 2

that the manufactures charge either:
-the wholesaler
-or the retail pharmacy

Question 3

what does awp stand for

Answer 3

average wholesaler prince (set by the manufacturer)

Question 4

what does wac stand for?

Answer 4

wholesaler acquisition cost (price the wholesaler pays the manufacturer to obtain the drug)

Question 5

what does AAC stand for?

Answer 5

actual acquisition cost (hidden info)

Question 6

the ___ pays the AAC to ____

Answer 6

the PHARMACY pays the AAC to the manufacturers or the wholesaler

Question 7

what are 2 examples of what the WHOLESALERS can charge the retail pharmacy

Answer 7

1. WAC + markup%
   OR
2. AWP-discount%

(competing wholesalers use discount % to attract pharmacies to buy their product)

Question 8

what does UAC stand for?

Answer 8

usual and customary cost

Question 9

___ pays the UAC to _____

Answer 9

uninsured customers pay the UAC to the retail pharmacy

Question 10

what does the retail pharmacy charge insured customer’s?

Answer 10

the retail pharmacy follows the insurer’s payment formula

Question 11

what do INSURED customers pay the retail pharmacy?

Answer 11

copayment or coinsurance

Question 12

insurance companies use public info to estimate what value?

Answer 12

AAC (Actual acquisition cost)

what the retail pharmacy actually paid the wholesaler or manufacturer to obtain the drug

Question 13

what is the “public info” that insurance companies use to estimate the value of AAC?

Answer 13

WAC + markup%
or
AWP-discount%