TAKE FIVE – Validate: A Cliff Note Series on Pharmacy Benefit Management

Over the last two weeks, I covered different facets of the pharmaceutical management industry and how it can affect your pharmacy benefit contract in my TAKE FIVE series. So far, I've gone over "Educate" and "Investigate" of this 5 Part series. This week, I'll continue this series by sharing with you my thoughts on how to “Validate” your pharmacy benefit plans. So, let's dive right in:


WEEK 3 - TAKE FIVE to Validate


Every two weeks in the U.S., tens of billions of dollars in pharmacy benefit claims are paid by plan sponsors without review! This means that mistakes due to system problems, coding errors, complexity of PBM contracts and ever-changing pricing discounts are leading to costly errors that sponsors and self-funded employers aren't catching. So, ask yourself this question: What good does it do to spend lots of time and money on trying to negotiate the best PBM contract if you're not taking the time - or working with a partner - to validate the delivery of the contract terms?

Confirm Loose Language Definitions
“Brand” versus “generic” definitions can affect how your PBM reports their pricing guarantees. THIS IS A VERY BIG DEAL! Loose language in your PBM contract may allow the PBM to “pick” which financial guarantee bucket certain drugs will go into, which will affect how competitive your contractual discounts look to the untrained eye. For example, a PBM may have a “loose” definition of how to classify a generic drug when dealing with guarantees, which allows them to claim both higher brand and generic discounts. You’ll need to look deeper into your data and contract to understand what you’re actually paying compared to industry benchmarks.

Ask Questions When Things Don't Add Up
You can’t manage what you can’t measure. That being said, it's ultimately your responsibility to verify if your PBM is providing the discounts negotiated in the contract. Not monitoring your plan performance compared to the contractual terms, or failing to monitor and respond accordingly to your actual claims data, limits your ability to validate your PBM contract. You need to become familiar your contract and ask questions when things don't add up.

Review Your PBM Formulary 
While reviewing your current PBM contract, you'll also want to validate whether your PBM's formulary structure works for your needs, or whether certain drugs with significantly less expensive alternatives should be blocked. Watching the days’ supply of certain oncology drugs may eliminate waste. Claims reviews and aggressive clinical oversight and management often yields savings of more than 15%. 

Minimize Unnecessary Waste and Expense
Many Employers believe their PBM is “doing it all” and that every opportunity to avoid waste has been explored and is in place. Unfortunately, this isn't always the case. Validate to see if there are more opportunities to save. Validate with your actual claims data to compare your current PBM contract and rebates to what could be. Minimize expenses and waste to maximize available funds to pay for life-saving cures. Validate and quantify administrative and coalition membership expenses to see if there are other choices. 

Let Synergy Help YOU Validate Your Pharmacy Benefit Plan!
When was the last time you validated your pharmacy benefit contract? There are no strings attached to validate current results to “what could be”.  Pharmacy benefits are complicated, but services are available to help employers understand the complex prescription drug ecosystem. These services give employers and brokers the confidence that they can secure competitively priced PBM contracts, and maintain affordable, high-quality prescription drug coverage for their employees. So, for employers with midyear medical and pharmacy contracts expiring who are troubled by benefit costs and increasing trends, why not schedule a 30 minute conversation with me to discuss your concerns and needs!

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Pharmacy Benefit Management Solutions

Synergy Pharmacy Benefit Consultants, LLC
2111 Bagnell Dam Blvd #37
Lake Ozark, MO 65049

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