Effective Rate and Net Margin Reconciliation (AWP Discount Guarantee)
A pharmacy's achieved effective rate against a contract guarantee, for brand or generic claims over a period.
Open the tool → Runs in your browser. Data leaves only if you deliberately send a problem report from the interactive tool.
Example
- Sum of AWP for the claims the contract counts
- 1000000 dollars
- Ingredient cost paid on those claims
- 180000 dollars
- Guaranteed discount off AWP
- 85 percent
Result: Achieved effective rate AWP - 82%.
The tool opens with these values already filled in. Replace them with your own.
What you enter
- Sum of AWP for the claims the contract counts
- Ingredient cost paid on those claims
- Guaranteed discount off AWP
- Number of prescriptions
- Dispensing fees paid (0 if none)
- Price concessions and later fees taken (0 if none)
- Acquisition cost of the drugs dispensed
- Or a claims list (CSV with a header row: type, AWP, ingredient cost paid; optional fee, concessions, acquisition cost, patient pay)
The other 2 fields
- Claims list: guaranteed brand discount off AWP
- Claims list: guaranteed generic discount off AWP
How this is calculated
Citation
Stated arithmetic on a pharmacy contract and its remittances: effective rate is one minus ingredient cost paid over AWP; the gap to the guarantee times AWP is the true-up exposure. 42 CFR 423.100, negotiated price: for Part D, the lowest possible reimbursement, with all price concessions. Read the source ↗
A reference and educational tool. Not medical, legal, or financial advice, and not a substitute for clinician judgment.