Close Close

Life Health > Health Insurance > Life Insurance Strategies

When Your Client Subscribes To Fortune, Forbes-And Lipitor

Your article was successfully shared with the contacts you provided.

Once upon a time, boomers helped swell subscriptions for Mademoiselle and Rolling Stone. These days, the boomers are getting what amounts to regular subscriptions for drugs that control conditions such as high blood pressure, high cholesterol levels and diabetes.

“The trends are pretty clear,” says Dr. Edmund Pezalla, medical director at Prescription Solutions, Irvine, Calif., a pharmacy benefits manager that runs a mail order pharmacy. “As people get older, they need more chronic medication. They are more likely to use mail service.”

Executives at the pharmacy benefit managers, retail drug store chains and other organizations that run “mail order pharmacies” or “home delivery pharmacies” see the aging of the boomers as an opportunity to expand their operations dramatically while helping boomers improve management of their health.

For health insurance agents, brokers and carriers, the aging of the boomers may lead to more questions about the nuts and bolts of how a specific plan’s mail order pharmacy program actually works. For a client who depends on a mail order service for reliable deliveries of essential, life-preserving medication, the quality of the mail order pharmacy may be as important as the quality of the wellness benefits or the plan website.

Even for companies and professionals that focus on asset accumulation and income planning, learning about clients’ mail order pharmacies might be as important as learning about the magazines they read and the TV shows they watch because of the pharmacies’ hold on so many boomers’ mailboxes.

Even boomers who pay all bills online and direct all mail to the trash may be prompt about opening the boxes that contain their Lipitor pills or diabetic supplies.

Mail order pharmacies accounted for about 25% of all U.S. prescription drug sales in 2005, according to William Blair & Company, Chicago, an investment bank.

The mail order pharmacies ranked second in terms of market share when compared with the big chains, which had a 41% share, but ahead of the 20% share held by grocery stores and discount stores, and far ahead of the 14% share held by independent pharmacies.

In 2005, about 30% of the employers that belong to the National Business Group on Health, Washington, were requiring employees to use mail order pharmacies for some types of prescription drugs, and about 20% said they wanted to move to “mandatory mail” programs in the next year.

Boomers are great customers now and should be even better customers once they turn 65, because consumers over 65 use twice as many prescriptions as younger members, and they often have the kinds of chronic conditions that are a good match for mail order pharmacy programs, according to Express Scripts Inc., St. Louis, a large pharmacy benefits manager.

Although the higher-income Americans who make up the typical financial professional’s client base tend to be healthier than the average American, they are about as likely as other Americans to suffer from chronic conditions requiring daily use of prescription medications.

When the Commonwealth Fund, New York, surveyed U.S. adults ages 50 to 64 in 2004, they found 62% of the adults in households with annual incomes over $60,000 reported having either cancer or 1 of 5 common chronic conditions, such as diabetes or high blood pressure. That was the same percentage as for all U.S. adults who participated in the survey.

Trade groups representing community drug stores often oppose insurance policy provisions, laws and regulations that encourage or require insureds to use mail-order pharmacies.

The large pharmacy chains tend to take a neutral or positive view of use of mail order because they often operate their own mail order pharmacies.

Health insurance groups, such as the National Association of Health Underwriters, Arlington, Va., tend to be sympathetic to the idea that mail order pharmacies offer employers and consumers an option that can help save them money.

Life insurance agents and others who have a stake in boomers living long, healthy lives should support programs that encourage use of mail order pharmacies because they can play a role in improving adherence to doctors’ recommendations, Pezalla says.

Because doctors can send prescriptions straight to mail order pharmacies, and the pharmacies are almost certain to ship out the prescriptions, “it’s much more likely the member will follow through” and actually fill the prescription, Pezalla says.

Moreover, “if people don’t refill the prescriptions we mail, we check on them,” Pezalla says.