Timing is everything when it comes to the success of MemberHealth, a national pharmacy benefits manager that administers prescription drugs for commercial and government organizations. In 2006, the oldest of the baby boomers, the generation born between 1946 and 1964, turned 60 years old. As this generation ages, the demand for prescription drugs will increase, making it the largest group of health-care consumers in the country.
So it's no coincidence that MemberHealth has had explosive growth since founder and CEO Charles Hallberg started it with the help of his daughter, Jennifer, in 1998. In fact, between 2003 and 2006, MemberHealth experienced 20,129 percent sales growth and, in 2006, posted $1.24 billion in sales.
MemberHealth administers the nation's fourth-largest Part D plan, serving 1.2 million members and processing in excess of 60 million prescriptions annually. The company services the Community CCRx Medicare Part D Plan on behalf of its new affiliates, Pennsylvania Life Insurance Company and American Progressive Life & Health Insurance Co. of New York. In addition, MemberHealth administers the prescription benefit portion of Medicare Advantage plans nationwide for its affiliates under the "Today's Options powered by CCRx" brand.
Participating in the Medicare Part D program proved to be one of the biggest challenges for the company, says Hallberg. First, its business partner, Computer Sciences Corporation Inc., declined to become the prime contractor for the drug plan — on the day the application was due to the Centers for Medicaid and Medicare Services (CMS). As a result, MemberHealth and Computer Sciences scrambled to submit a revised application to CMS with MemberHealth as the primary sponsor. Then, once awarded the Part D contract, the company had to raise $100 million in capital in less than three months.
"We happened to be in the right place at the right time when Congress passed the Medicare Modernization Act," Hallberg says. "But, creating opportunities that you can capitalize on is the key. A good idea is not good enough; it is how you execute with clarity of vision that leads to success. We were mentally and intellectually ready to step into that role. As a result, we were successful."
MemberHealth focuses on the needs of Medicare beneficiaries by aligning the interests of beneficiaries with those of pharmacists and other members of the health-care system, and by providing outstanding service.
"The company differentiates itself in the market by encouraging strong relationships between patients, pharmacists and physicians," says Hallberg. "These relationships enable patients to learn how to take their medicines correctly, stay healthy and save money."
That commitment to exceptional service has certainly paid off. People who enrolled in MemberHealth's CCRx Part D plan in 2006 saved a total of $1.1 million a month in co-payments by switching from brand name to generic medicines.
The nearly 10-year-old company is poised for future growth and success. In September, MemberHealth was acquired by Universal American Financial Corp. of Rye Brook, N.Y. Currently, it is developing, in conjunction with other members of the Universal American family of companies, a Medicare Advantage program with integrated prescription drug coverage. The company also plans to expand its services to include medical and pharmacy plans for commercial, labor and municipality employer retiree groups.