Clinic 1 dispensed 452 drugs and Clinic 2 dispensed 573 drugs, respectively. Clinic names have been removed for security reasons and the formularies are shown in detail in Appendix 1 of this document. The VA has no nationally negotiated outsourcing contract with major retail chains. In the following analysis, locally negotiated contract formulas were used. A MAC is a set limit a retail pharmacy can charge for an item, though the pharmacy can still charge a dispense fee.
MACs are almost always lower than AWPs and generally apply to generics.
Using the lowest available costs means that all retail prices in this analysis are conservative. AWPs and MACs were obtained from a variety of current sources including the Red Book, AmeriSource Corporation, and First DataBank. Using these formulas, prices can be estimated by line item by clinic. Appendix 2 contains this local data, both unweighted and weighted by usage volume. The variable cost is composed of the FSS price of the item purchased on federal contract plus any applicable repackaging costs.