We offer plan sponsors assistance through the entire management of the pharmacy benefit program.
Step One – Obtain an analysis of your current PBM contract and finding weaknesses that can reduce pharmacy costs by 30%. Does your contract:
- Allow the PBM to define brand, generic and specialty drugs which reduce the effectiveness of financial performance guarantees?
- Allow the PBM to select an auditor, not the plan?
- Allow for the PBM to control an audit through defining what the auditor has access to in terms of data?
- Not allow for rebate audits?
- Have meaningless performance standards that your PBM meets year after year but still leaves you responsible for cost increases?
Step Two – Conduct a “Request for Proposal” (”RFP”) by sending out a contract rather than a 200 page questionnaire. PBM services are a commodity today with all PBMs providing similar basic services. You pay a consultant to sort through the “good” PBMs and the “bad” ones. This can be accomplished by sending out the final product – a contract you and your PBM can live with that:
- Clearly states the PBMs responsibilities and the Plan’s responsibilities
- Provides clear terms that are understandable
- Allows the plan sponsor control over pricing
- Avoids the games in the industry
- Requires an annual review of pricing terms
- Defines key terms like rebates, AWP, MAC, generic, brand and specialty drugs
Step Three – Conduct a claims audit of the PBM. Many plan sponsors have NEVER conducted an audit of their PBMs. Conducting audits provide proper management of your program. Without knowing what AWP costs are, do you know if you are getting the discounts promised? Our audits:
- Verify the AWP with outside pricing guides on the date dispensed for 100% of the transactions
- Verify that the retail, mail order, specialty pricing for brand drugs are taken in accordance with the contract terms
- Verify that the MAC list is performing in accordance with plan provisions or at least at AWP – 65% for retail and AWP – 80% for mail order
- Verify all aspects of plan design including copays, limits, exclusions and prior authorizations
Conducting a rebate audit of the PBM. Yes, rebates can be audited and yes, rebates are increasing in value. Our audits focus on brand drug rebates – not just what the PBM calls rebates – but all financial benefitsfrom the PBM and Pharmaceutical Company relationship:
- Is the PBM invoicing the correct amounts of rebates to the Pharmaceutical Company?
- Is all of our client’s units included in the invoicing?
- Are the rebate contracts favoring the PBM and losing out on opportunities for the plan sponsor?
- Are all the dollars being passed back to the plan sponsor in accordance with the contract terms?