Most data for the HMO-PPO Digest were gathered by SDI, Plymouth Meeting, Pa., a leading provider of innovative health care data products and analytic services. The data derive from information gathered by mail and telephone surveys between February and June 2009. Mail questionnaires are refined every year to reflect changes in industry operations and include, for example, questions specific to the Medicare and Medicaid managed care populations.

Nearly all of the data that appear in this Digest are from a census of the HMO and PPO industries.When data were not available from all plans, a smaller sample was used. Prescription metrics are from SDI's Vector One®: Payer platform.

Medicare and Medicare demographic information in the HMO-PPO Digest was gathered from operating HMOs. SDI used information from the Centers for Medicare & Medicaid Services's (CMS) 2008 Medicaid Managed Care Enrollment Report to capture the total number of Medicaid recipients in HMO programs. The Medicaid HMO demographic data shown in this Digest are as of midyear 2008.

SDI often telephones HMOs and PPOs and faxes information to the plans for the purpose of validating information obtained from them. SDI also compares its data with those published in other sources, including trade associations in the managed care industry, periodicals and journals, andstate regulatory agencies. SDI does this to ensure that its database includes an accurate count of all operating HMOs and PPOs in the nation.

A final review process takes place, before and during the production of this report, between SDI and Forte Information Resources, Denver Co., a leading provider of publishing products and services for the health care industry.

Sanofi-aventis, as sponsor of this report, maintains an arm's-length relationship with the organizations that prepare the Digest and carry out the research. The desire of sanofi-aventis is for the digests to be completely independent and objective.

Market Definitions

As part of the survey process, HMOs supplied a definition of their service area by county. This information was rolled- up to the MSA, the consolidated MSA (CMSA) and the state in order to provide the health plans which are displayed when a market is identified.

The HMOs that appear in each of the markets include those plans that serve the counties in that market. However, we have adjusted the data to include only those plans that cover at least 50% of the counties in their respective MSA.

For those MSAs that have fewer than five plans, the report automatically defaults to the state level. This is to ensure the integrity of the data.

For questions about the terms used in this Digest, consult the Key Terms page.

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National Retail Pharmacy Data

The Drug Costs and Utilization section, which begins on page 56, presents, for the first time in this Digest, a comprehensive overview of the national performance of prescription drugs dispensed by retail pharmacies. National-level retail pharmacy data across a dozen therapeutic drug classes are organized according to major chronic disease category.

This section also features utilization metrics for five common products across each of these 12 classes, by payer type. The spending metrics represent the full price that the retail pharmacy charges the consumer for the product, regardless of copayment.

Average out-of-pocket (OOP) measures, by therapeutic drug class, are likewise examined. These costs represent the amount patients are required to pay the retail pharmacy for their individual prescription drug. The cost mainly includes copayments, but can also include tax, deductibles and cost differentials, where applicable (everything the patient paid at the point of sale).

The retail pharmacy drug analysis extends to data on 10 specialty drug classes, within which data on 20 common products are likewise featured.

The prescription metrics derive from SDI's Vector One®: Payer (VOPA) platform. Through agreements with a variety of data providers, the SDI data warehouse receives billions of prescription claims per year. Prescription data samples are included from nearly 59,000 pharmacies (over 99% in the U.S.).

VOPA is SDI's projected prescription and patient-centric database. The only database of its kind, it provides projected retail pharmacy prescription and longitudinal metrics at various levels of aggregation, including state, region, and national levels. SDI utilizes a unique and patented algorithm for de-identification of patients, ensuring compliance with HIPAA regulations.

SDI uses projection territories aligned to balance coverage proportional to prescribing activity. These territories are stratified by payment type and the sample is expanded to the universe by strata, census division, and class of trade. SDI reconciles the results to produce a single projection factor for each claim. This factor is used to project prescriptions and patients filling a prescription. Patient counts will be unique at the focus diagnosis level by gender, age, and payer type (including Medicare Part D). These factors are used to project prescriptions and patients in each territory. Regional and national projections are created by rolling up from the prescriber to the geographic area of interest. These data are current as of midyear 2009, and are trended over three years.

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