Why Blue Shield of California’s CEO thinks more payers will leave traditional PBMs behind and other notes from around the interweb:

• Why Blue Shield of California’s CEO thinks more payers will leave traditional PBMs behind. Blue Shield of California CEO Paul Markovich won’t be surprised if other payers ditch traditional pharmacy benefit managers for a new model. The Oakland-based BCBS affiliate made headlines in August when it said it would not renew its contract with CVS Caremark to manage pharmacy benefits for its 4.8 million members, opting instead for a partnership with Amazon Pharmacy and Mark Cuban’s Cost Plus Drugs as preferred pharmacy providers. Despite the shakeup, CVS will continue to administer Blue Shield’s specialty drug benefits. “We’re going to launch it, we’re going to make it work, and we’re going to push everybody else to probably adopt something similar, because if they don’t, they’re going to have a worse consumer experience and they’re going to have a hard time keeping up unless they adapt,” Mr. Markovich told Becker’s.

• LA County sues pharmacy benefit firms, alleging they helped fuel opioid crisis. Los Angeles County has become the latest local government to accuse pharmacy benefit managers — the little-known middlemen of the prescription drug industry — of stoking the opioid crisis by helping flood the nation with highly addictive pills. In a lawsuit filed Wednesday in Los Angeles County Superior Court, the county alleged that Express Scripts Inc. and OptumRx Inc. colluded with drug manufacturers to promote dangerously addictive opioids as a safe and moderate pain treatment option. The 59-page filing describes the havoc that the opioid crisis has wreaked inside the county’s emergency rooms, schools and child welfare system: Children are raised by relatives or put in foster care due to parents’ addictions. Overdose patients are increasingly common in the county’s emergency rooms. And at least six students overdosed at the start of the 2022-23 school year, according to the suit.

• Playbook for Employers – Addressing PBM Misalignment. The guide, released by the National Alliance of Healthcare Purchaser Coalitions, identifies several key strategic recommendations that employers can adopt when looking to better navigate their relationship with PBMs. For one, the playbook recommends that employers find advisers that are genuinely putting in the work for them. Advisers should be independent and transparent, according to the guidebook, and contracts should be designed to ensure that PBMs act in the employer’s best interest. “As we uncover these increasingly apparent anomalies, I think we’ve got to challenge ourselves to do better and most importantly require that our advisers, our middlemen and our intermediaries do better on our behalf,” Mike Thompson, CEO of the alliance, told Fierce Healthcare.

• STAT News investigation takes deep dive into PBM broker conflicts of interest. Employers across the country — from big names like Boeing and UPS to local school systems — pay consulting firms to handle a straightforward task with their prescription drug coverage: Get the best deals possible, and make sure the industry’s middlemen, known as pharmacy benefit managers, aren’t ripping them off with unfair contracts. But a largely hidden flow of money between major consulting conglomerates and PBMs compromises that relationship, a STAT investigation shows. Some consulting firms often are getting paid more — a lot more — by the PBMs and health insurance carriers that they are supposed to scrutinize than by companies they are supposed to be looking out for.

In the dynamic landscape of healthcare, drug utilization management programs play a pivotal role in optimizing medication use, controlling costs, and ensuring patient safety. These programs encompass a variety of strategies, each designed to balance effective treatment with fiscal responsibility. This article delves into the key components of drug utilization management (DUM) programs, including step therapy, therapeutic substitution, mandatory generic enforcement, prior authorization, pill splitting, refill too soon, dose optimization, quantity limits, disease management programs, and formulary exclusions. For each strategy, we will outline its benefits and challenges.

1. Step Therapy: Step therapy is a DUM approach that requires patients to try lower-cost or generic medications before accessing more expensive alternatives. This strategy aims to ensure cost-effective therapy without compromising patient outcomes. Benefits include cost savings for both patients and payers. However, challenges may arise when patients require immediate access to a specific medication due to clinical urgency.
2. Therapeutic Substitution: Therapeutic substitution involves replacing a prescribed drug with an alternative within the same therapeutic class. This approach can reduce costs and promote generic utilization. Benefits include financial savings and increased competition among manufacturers. Challenges may arise if the alternative medication is not as effective for certain patients or if patients experience adverse effects.
3. Mandatory Generic Enforcement: Mandatory generic enforcement requires patients to use generic versions of brand-name drugs when available. This strategy promotes cost savings by leveraging the lower prices of generic medications. Benefits include reduced prescription drug costs and enhanced financial sustainability. Challenges may arise if patients have concerns about the efficacy or safety of generic substitutions.
4. Prior Authorization: Prior authorization mandates approval from the payer before specific medications are dispensed. This approach ensures appropriate use and cost-effective treatment. Benefits include preventing unnecessary utilization and controlling expenditures. However, challenges may emerge in cases of delayed treatment due to the approval process.
5. Pill Splitting: Pill splitting involves prescribing higher-dose tablets that patients can split to achieve the desired lower dose. This strategy can reduce costs and promote adherence. Benefits include cost savings and improved medication adherence. Challenges may include difficulties in accurately splitting tablets and potential inconsistencies in dosing.
6. Refill Too Soon: Refill too soon policies limit early refills to prevent medication misuse or overutilization. Benefits include preventing potential medication abuse and optimizing treatment adherence. However, challenges may arise if patients experience unexpected changes in treatment plans or dosage adjustments.
7. Dose Optimization: Dose optimization involves adjusting medication dosages to align with evidence-based recommendations. This strategy improves medication effectiveness while minimizing adverse effects. Benefits include enhanced patient outcomes and cost savings. Challenges may include the need for careful monitoring during dosage adjustments.
8. Quantity Limits: Quantity limits restrict the dispensing of medications beyond specific quantities over a defined period. This strategy prevents excessive use and stockpiling. Benefits include cost control and improved patient safety. Challenges may emerge if patients require larger quantities due to unique circumstances.
9. Disease Management Programs: Disease management programs offer comprehensive care for patients with chronic conditions, integrating medication therapy with other interventions. Benefits include improved disease control, enhanced patient education, and reduced healthcare utilization. Challenges may include resource-intensive implementation and patient engagement.
10. Formulary Exclusions: Formulary exclusions involve removing certain medications from the approved drug list to encourage the use of cost-effective alternatives. Benefits include cost savings and promoting rational drug use. Challenges may arise if patients require the excluded medication for clinical reasons.

Drug utilization management programs encompass a diverse range of strategies aimed at optimizing medication use while controlling costs. Each strategy offers distinct benefits, from cost savings to improved patient outcomes, but they also present unique challenges that require careful consideration. Balancing these factors is essential to achieving a successful DUM program that prioritizes both the financial health of payers and the well-being of patients.

Here’s a table summarizing each Drug Utilization Management (DUM) program, along with their benefits and challenges:

Please note that this table provides a concise overview of the benefits and challenges associated with drug utilization management programs. The actual implementation and outcomes of these programs may vary depending on specific healthcare settings and patient populations.

Employers would like to see changes spread to the business sector as prescription costs climb and other notes from around the interweb:

• Employers would like to see changes spread to the business sector as prescription costs climb. The cost of pharmaceuticals is a key topic for policymakers on the Hill, and it should come as no surprise that it’s also a major concern for employers across the country. The Business Group on Health released its annual survey of large employers this week and found that 91% are either concerned or genuinely very concerned about overall pharmacy cost trend. Alongside that finding, the survey identified that the median spending on pharmacy continues to grow, rising from 21% in 2021 to 24% in 2022. In addition, 92% said they were either concerned or very concerned about high-cost drugs coming through the pipeline. Specialty pharmacy accounts for a growing portion of health spend, and orphan drugs for rare, complex diseases account for large swaths of products coming to market.

• DOJ Generic Drug Price-Fixing Settlement. Teva Pharmaceuticals on Monday announced that it reached a deferred prosecution agreement with the U.S. Department of Justice over its drug price-fixing case involving generic drugs. Under the deferred prosecution agreement (DPA), Teva will pay a total of $225 million over a five-year period starting next year. From 2024 to 2027, the company will make $22.5 million tranches, culminating in a $135 million lump sum in 2028. Teva also agreed to divest one additional generic product to a third-party buyer. In return, the DPA will allow Teva to sidestep a mandatory exclusion from U.S. federal healthcare programs, which would have been the company’s punishment if the case had gone to trial, and it had been found guilty. In its news release, Teva pinned the drug price-fixing charges on a single former employee, who between 2013 and 2015 “agreed with competitors that Teva would not bid on an opportunity to supply that customer with a particular generic product.” As part of the agreement, the company has also committed to implementing and maintaining compliance controls to prevent such incidents from happening again.

• Playbook for Employers – Addressing PBM Misalignment. The guide, released by the National Alliance of Healthcare Purchaser Coalitions, identifies several key strategic recommendations that employers can adopt when looking to better navigate their relationship with PBMs. For one, the playbook recommends that employers find advisers that are genuinely putting in the work for them. Advisers should be independent and transparent, according to the guidebook, and contracts should be designed to ensure that PBMs act in the employer’s best interest. “As we uncover these increasingly apparent anomalies, I think we’ve got to challenge ourselves to do better and most importantly require that our advisers, our middlemen and our intermediaries do better on our behalf,” Mike Thompson, CEO of the alliance, told Fierce Healthcare.

• STAT News investigation takes deep dive into PBM broker conflicts of interest. Employers across the country — from big names like Boeing and UPS to local school systems — pay consulting firms to handle a straightforward task with their prescription drug coverage: Get the best deals possible, and make sure the industry’s middlemen, known as pharmacy benefit managers, aren’t ripping them off with unfair contracts. But a largely hidden flow of money between major consulting conglomerates and PBMs compromises that relationship, a STAT investigation shows. Some consulting firms often are getting paid more — a lot more — by the PBMs and health insurance carriers that they are supposed to scrutinize than by companies they are supposed to be looking out for.

In the complex world of healthcare, one aspect that often leaves both patients and healthcare providers frustrated is the prior authorization (PA) process, particularly in the realm of pharmacy benefits management (PBM). The term “prior authorization” refers to the practice of obtaining approval from a healthcare insurer or PBM before a prescribed medication or treatment can be covered by insurance. While the intention behind prior authorizations is to ensure appropriate and cost-effective care, the process has become a profit center, often favoring high-cost drugs over lower cost therapeutic equivalents or alternatives. In this article, we will delve into the intricacies of prior authorizations, discuss the role of electronic prior authorization (ePA) vendors, highlight common pitfalls, and explore ways to measure the effectiveness of this process.

Understanding the Prior Authorization Process

The prior authorization process begins when a healthcare provider prescribes a medication that falls under the coverage of the patient’s insurance plan. The provider submits a request to the PBM or insurer, providing information about the patient’s medical history, the prescribed medication, and the rationale for the treatment. The PBM then reviews the request to determine if the prescribed medication meets certain criteria for coverage, such as medical necessity, cost-effectiveness, and formulary compliance. If the PBM approves the request, the medication is covered by insurance. If not, the healthcare provider may need to explore alternative treatments or submit additional documentation to support the request.

The Role of Electronic Prior Authorization (ePA) Vendors

To streamline and expedite the prior authorization process, many healthcare organizations have turned to electronic prior authorization (ePA) vendors. These vendors provide digital platforms that enable healthcare providers to submit prior authorization requests electronically, reducing the reliance on paper-based forms and fax machines. ePA vendors also offer real-time communication between providers and PBMs, making it easier to track the status of requests and receive timely decisions.

CoverMyMeds, a leading electronic prior authorization (ePA) vendor, has grown to become one of the largest ePA platforms, serving as a bridge between healthcare providers, pharmacies, PBMs, and insurers. CoverMyMeds was acquired by McKesson Corporation in 2017. McKesson is a large healthcare services and pharmaceutical distribution company. Commonsense suggests drug wholesalers, like McKesson, want to get drugs out of their distribution centers as fast as possible. PA denials are inconsistent with drug wholesaler inventory turnover goals, for instance. Second to Optum’s acquisition of Change Healthcare, McKesson’s acquisition of CoverMyMeds is the largest conflict of interest in the pharmacy benefits management industry. The third most significant conflict of interest are non-fiduciary PBMs or their parent companies which own mail, retail and/or specialty pharmacies.

Common Pitfalls of the Prior Authorization Process

Despite the potential benefits of ePA vendors, the prior authorization process still faces several challenges. One of the most significant criticisms is the role of non-fiduciary PBMs. These PBMs are responsible for managing prescription drug benefits on behalf of insurers and employers, but they also have financial incentives that can conflict with patient care. Critics argue that non-fiduciary PBMs may prioritize revenue over cost-effectiveness, leading to low clinical value drug prior authorization (PA) approvals, for example. A “low clinical value” or LCV drug refers to a medication or treatment that provides limited or minimal therapeutic benefit to patients in relation to its cost, potential side effects, or overall impact on health outcomes.

Additionally, the PA process can be time-consuming for healthcare providers. The administrative burden of submitting requests, gathering documentation, and waiting for decisions can detract from valuable time that could be spent with patients. Delays in obtaining prior authorization can also lead to disruptions in treatment plans, affecting patient outcomes.

Measuring the Effectiveness of Prior Authorizations

To determine the effectiveness of the prior authorization process, several key metrics can be considered:

1. Timeliness: The time taken for a PBM to review and respond to a prior authorization request is a crucial factor. Delays in approvals can impact patient care, especially for acute conditions. Assuming all necessary documentation is received from a provider, 24 hours is a reasonable turnaround time for PA decisions.
2. Approval Rates: Measuring the percentage of prior authorization requests that are approved provides insights into the accessibility of both necessary and unnecessary treatments. PA approval rates greater than 70% signal rubberstamping. Cost-effective PA evaluation criteria must incorporate checks for lower cost therapeutic alternatives, FDA approved labeling, patient selection criteria, and clinical trial check points.
3. Appeal Rates: Tracking the number of appeals submitted by healthcare providers can indicate the level of dissatisfaction with prior authorization decisions. However, appeal approval rates above 70% signal rubberstamping especially when first and second level appeals are evaluated by the same PBM who stands to gain from LCV high-cost drug PA approvals.
4. Patient Outcomes: Monitoring patient outcomes after receiving treatments that required prior authorization can reveal whether the process affects health improvements. Medication Therapy Management (MTM) is a comprehensive approach to optimizing a patient’s medication regimen by ensuring safe, effective, and appropriate medication use, often involving pharmacist consultations and reviews of medication plans. It aims to improve patient outcomes and reduce medication-related problems.

Conclusion

A prior authorization (PA) is a well-intentioned mechanism to ensure cost-effective and appropriate healthcare. However, the process has become convoluted, and the involvement of non-fiduciary PBMs has raised concerns about potential conflicts of interest. The rise of electronic prior authorization vendors offers hope for a more streamlined process, but challenges persist. Prior authorizations are critical in utilization management programs yet plan sponsors and their advisors often take them for granted. The $50 fee per PA belies their impact on patient outcomes and costs for both members and the plan. A self-insured group with 2,500 members could easily achieve incremental savings of $500k annually with cost-effective PA and appeal processes alone.

As the healthcare industry continues to evolve, finding a balance between cost containment and patient-centered care will be essential. Whether through increased transparency, more standardized criteria, or a shift toward fiduciary PBMs, the goal should remain focused on delivering timely and cost-effective drug treatments to those in need.

The Transformation of Blue Shield of California’s Prescription Drug Model: What’s Behind It and other notes from around the interweb:

• The Transformation of Blue Shield of California’s Prescription Drug Model: What’s Behind It? Blue Shield of California is significantly reducing its partnership connections with CVS Caremark, while simultaneously welcoming four new collaborators to enhance its prescription drug benefits network. Among these new associates are Mark Cuban’s Cost Plus Drug Company and Amazon Pharmacy. According to Salina Wong, the Senior Director of Clinical Pharmacy Programs at Blue Shield of California, these shifts are essential to challenge the existing flawed system.

• Annual Report on Specialty Spend and Trends (2023). The seventh annual State of Specialty Spend and Trend Report uses integrated pharmacy and medical claims data to provide a holistic view of specialty drug spend and trends. First published in 2017, this report is the sole comprehensive analysis of specialty drug spending, powered by the industry’s leading integrated dataset through Artemetrx. Key takeaways include the percentage of members taking at least one specialty drug continues to rise (4%), while the average number of claims per person remains steady at 5 claims per year. Another key takeaway, specialty spend continues to shift from the medical benefit to the pharmacy benefit, the latter of which now accounts for 56.3% of spend.

• Playbook for Employers – Addressing PBM Misalignment. The guide, released by the National Alliance of Healthcare Purchaser Coalitions, identifies several key strategic recommendations that employers can adopt when looking to better navigate their relationship with PBMs. For one, the playbook recommends that employers find advisers that are genuinely putting in the work for them. Advisers should be independent and transparent, according to the guidebook, and contracts should be designed to ensure that PBMs act in the employer’s best interest. “As we uncover these increasingly apparent anomalies, I think we’ve got to challenge ourselves to do better and most importantly require that our advisers, our middlemen and our intermediaries do better on our behalf,” Mike Thompson, CEO of the alliance, told Fierce Healthcare.

• STAT News investigation takes deep dive into PBM broker conflicts of interest. Employers across the country — from big names like Boeing and UPS to local school systems — pay consulting firms to handle a straightforward task with their prescription drug coverage: Get the best deals possible, and make sure the industry’s middlemen, known as pharmacy benefit managers, aren’t ripping them off with unfair contracts. But a largely hidden flow of money between major consulting conglomerates and PBMs compromises that relationship, a STAT investigation shows. Some consulting firms often are getting paid more — a lot more — by the PBMs and health insurance carriers that they are supposed to scrutinize than by companies they are supposed to be looking out for.

As a CHRO or CFO on a buying committee, evaluating a pharmacy benefit manager (PBM) formulary is a critical task that requires careful consideration and attention to detail. Creating an effective PBM formulary requires expertise in the business of pharmacy benefits alongside clinician input. Here are ten key mistakes to avoid for enhanced patient care and cost savings:

1. Lack of Clinical Evidence: Failing to base formulary decisions on robust clinical evidence can lead to inappropriate or ineffective drug choices. Always ensure that formulary decisions are supported by reliable clinical data, including randomized controlled trials and meta-analyses.
2. Ignoring Comparative Effectiveness: Neglecting to compare the effectiveness of different drugs within the same therapeutic class can result in suboptimal drug choices and unnecessary costs. Always consider the relative efficacy and safety of available options.
3. Limited Stakeholder Involvement: Not involving key stakeholders, such as physicians, pharmacists, and plan administrators, in formulary decision-making can lead to poor acceptance and compliance with the formulary. Engage all relevant parties to gain valuable insights and perspectives.
4. Inadequate Consideration of Cost: Focusing solely on drug efficacy without considering the cost-effectiveness of treatments can lead to a formulary that is financially unsustainable for the PBM and its beneficiaries. Strive for a balance between clinical effectiveness and cost. For example, Fluoxetine 10 MG Capsules cost almost five times less than Fluoxetine 10 MG Tablets (see figure 1).

5. Omission of Essential Medications: Overlooking essential medications or therapeutic classes can limit patient access to necessary treatments and compromise their health outcomes. Ensure that a broad range of medications is available to meet patient needs.
6. Inconsistent Review Processes: Inconsistent or ad-hoc review processes can lead to inconsistent formulary decisions and a lack of transparency in the decision-making process. Establish clear and standardized criteria for formulary inclusion or exclusion.
7. Failure to Address Access and Equity: Not considering the impact of formulary decisions on patient access and health equity can lead to disparities in care. Account for patient demographics, disease prevalence, and healthcare disparities when designing the formulary. A cost-effective formulary can be constructed with as few as 1,250 products accounting for dose variations or formulations.
8. Insufficient Monitoring and Review: Neglecting to regularly monitor and reassess the formulary’s performance can lead to missed opportunities for improvement and adaptation to changing healthcare needs and advancements.
9. Inadequate Communication: Failing to communicate formulary changes effectively to prescribers, pharmacists, and patients can lead to confusion and disruptions in therapy. Implement clear and timely communication strategies to keep all stakeholders informed.
10. Conflict of Interest: Allowing conflicts of interest to influence formulary decisions can compromise the integrity and fairness of the process. Ensure that committee members disclose potential conflicts and establish mechanisms to address and manage these conflicts appropriately.

By avoiding these common mistakes and taking a comprehensive approach to formulary construction, you can be the impetus behind creating an effective PBM formulary. One that prioritizes patient care, cost-effectiveness, and clinical appropriateness.

Annual Report on Specialty Spend and Trends and other notes from around the interweb:

• Annual Report on Specialty Spend and Trends (2023). The seventh annual State of Specialty Spend and Trend Report uses integrated pharmacy and medical claims data to provide a holistic view of specialty drug spend and trends. First published in 2017, this report is the sole comprehensive analysis of specialty drug spending, powered by the industry’s leading integrated dataset through Artemetrx. Key takeaways include the percentage of members taking at least one specialty drug continues to rise (4%), while the average number of claims per person remains steady at 5 claims per year. Another key takeaway, specialty spend continues to shift from the medical benefit to the pharmacy benefit, the latter of which now accounts for 56.3% of spend.

• How Self-Funded Employers Can Use Point Solutions to Manage Pharmaceutical Costs. Point solutions are specialized tools or platforms designed to address specific issues or challenges faced by organizations. In the context of pharmaceutical cost management, point solutions provide targeted assistance in identifying cost-saving opportunities, improving medication adherence, streamlining prescription processes, and enhancing overall health outcomes. Before delving into the benefits of point solutions, it is essential for self-funded employers to gain a comprehensive understanding of their pharmaceutical costs. This entails assessing the utilization patterns, identifying high-cost drugs, analyzing prescription data, and exploring trends in pharmacy benefit claims. By closely examining these factors, employers can identify areas of potential savings and develop tailored strategies to optimize their pharmacy benefit plans.

• Playbook for Employers – Addressing PBM Misalignment. The guide, released by the National Alliance of Healthcare Purchaser Coalitions, identifies several key strategic recommendations that employers can adopt when looking to better navigate their relationship with PBMs. For one, the playbook recommends that employers find advisers that are genuinely putting in the work for them. Advisers should be independent and transparent, according to the guidebook, and contracts should be designed to ensure that PBMs act in the employer’s best interest. “As we uncover these increasingly apparent anomalies, I think we’ve got to challenge ourselves to do better and most importantly require that our advisers, our middlemen and our intermediaries do better on our behalf,” Mike Thompson, CEO of the alliance, told Fierce Healthcare.

• STAT News investigation takes deep dive into PBM broker conflicts of interest. Employers across the country — from big names like Boeing and UPS to local school systems — pay consulting firms to handle a straightforward task with their prescription drug coverage: Get the best deals possible, and make sure the industry’s middlemen, known as pharmacy benefit managers, aren’t ripping them off with unfair contracts. But a largely hidden flow of money between major consulting conglomerates and PBMs compromises that relationship, a STAT investigation shows. Some consulting firms often are getting paid more — a lot more — by the PBMs and health insurance carriers that they are supposed to scrutinize than by companies they are supposed to be looking out for.

PBM data analytics platform solutions provide specialized tools and services that analyze and interpret healthcare-related data to derive valuable insights. These insights can help employers make informed decisions, optimize their benefit programs, and improve employee health outcomes. In some cases, the right platform solution can help employee benefit brokers and consultants increase win rates. Here’s how PBM data analytics platforms enhance medical and pharmacy benefit programs while simultaneously serving as a valuable point solution:

• Benefit Program Optimization: Data analytics vendors can analyze healthcare utilization patterns, prescription drug data, and medical claims to identify trends and areas for improvement within the benefit program. Employers can use this information to make data-driven adjustments and tailor the program to better meet the needs of their workforce.
• Cost Containment: By analyzing claims data and pharmacy benefit usage, data analytics vendors can identify cost drivers and recommend strategies to contain healthcare spending without compromising the quality of care.
• Identifying High-Risk Individuals: Data analytics can be used to identify employees at risk for chronic conditions or those who may benefit from targeted wellness programs. Early identification allows employers to provide appropriate interventions and support, potentially reducing future healthcare costs.
• Predictive Modeling: Leveraging historical data and trends, data analytics vendors can build predictive models to estimate future healthcare costs and utilization. This helps employers plan and budget more effectively for their benefit programs.
• Pharmacy Benefit Management: Data analytics can help employers understand prescription drug usage patterns and identify opportunities for cost-saving measures, such as promoting the use of generic medications or negotiating better contracts with pharmacy benefit managers.
• Performance Measurement: Data analytics vendors can track the effectiveness of wellness programs, disease management initiatives, and other interventions. Employers can use this information to assess the program’s impact on employee health and make necessary adjustments.
• Compliance and Fraud Detection: Data analytics can be used to monitor healthcare claims for compliance with regulations and identify potential instances of fraud or abuse, safeguarding the integrity of the benefit program.
• Personalized Health Recommendations: By analyzing individual health data (while maintaining privacy), data analytics can provide personalized health recommendations to employees, encouraging healthier lifestyle choices and preventive care.

Integrating a PBM data analytics platform solution, as part of a medical and pharmacy benefit program, should be so easy that a ninth grader could do it after a 20-minute demo. PBM data analytics platform solutions can significantly enhance an employer’s ability to understand, manage, and improve the health outcomes of their workforce while optimizing the overall cost of healthcare benefits. However, it’s important to measure ROI and that appropriate data privacy and security measures are in place to protect employees’ sensitive health information.

How Self-Funded Employers Can Use Point Solutions to Manage Pharmaceutical Costs and other notes from around the interweb:

• How Self-Funded Employers Can Use Point Solutions to Manage Pharmaceutical Costs. Point solutions are specialized tools or platforms designed to address specific issues or challenges faced by organizations. In the context of pharmaceutical cost management, point solutions provide targeted assistance in identifying cost-saving opportunities, improving medication adherence, streamlining prescription processes, and enhancing overall health outcomes. Before delving into the benefits of point solutions, it is essential for self-funded employers to gain a comprehensive understanding of their pharmaceutical costs. This entails assessing the utilization patterns, identifying high-cost drugs, analyzing prescription data, and exploring trends in pharmacy benefit claims. By closely examining these factors, employers can identify areas of potential savings and develop tailored strategies to optimize their pharmacy benefit plans.

• Employers are suing their health plan for claims data in increasing numbers. Lawsuits from large companies and employers are increasingly being filed against third-party health plan administrators to access complete employee medical claims data. Through lawsuits recently filed against Aetna, Elevance Health and BCBS Massachusetts, employers claim payers have breached their fiduciary duties by not allowing complete access to claims data and how claims are processed. In a June 30 complaint, Kraft Heinz alleged Aetna has used its role as its TPA “to enrich itself to Kraft Heinz’s detriment” through undisclosed fees and processing medical and dental claims without human review. In December, bricklayer and metal worker unions filed a lawsuit against Elevance Health, alleging the payer does not allow self-insured plans to access their own claims data and charges the plans higher rates than it had negotiated with hospitals. A labor union in Massachusetts sued BCBS Massachusetts in April over similar allegations. These lawsuits are largely being driven by the Consolidated Appropriations Act and the hospital price transparency rule that took effect in 2021, according to a July 6 Bloomberg Law report.

• Playbook for Employers – Addressing PBM Misalignment. The guide, released by the National Alliance of Healthcare Purchaser Coalitions, identifies several key strategic recommendations that employers can adopt when looking to better navigate their relationship with PBMs. For one, the playbook recommends that employers find advisers that are genuinely putting in the work for them. Advisers should be independent and transparent, according to the guidebook, and contracts should be designed to ensure that PBMs act in the employer’s best interest. “As we uncover these increasingly apparent anomalies, I think we’ve got to challenge ourselves to do better and most importantly require that our advisers, our middlemen and our intermediaries do better on our behalf,” Mike Thompson, CEO of the alliance, told Fierce Healthcare.

• STAT News investigation takes deep dive into PBM broker conflicts of interest. Employers across the country — from big names like Boeing and UPS to local school systems — pay consulting firms to handle a straightforward task with their prescription drug coverage: Get the best deals possible, and make sure the industry’s middlemen, known as pharmacy benefit managers, aren’t ripping them off with unfair contracts. But a largely hidden flow of money between major consulting conglomerates and PBMs compromises that relationship, a STAT investigation shows. Some consulting firms often are getting paid more — a lot more — by the PBMs and health insurance carriers that they are supposed to scrutinize than by companies they are supposed to be looking out for.

The Federal Trade Commission votes to issue a cautionary statement against reliance on prior advocacy statements and studies related to pharmacy benefit managers (PBMs) due to several compelling reasons:

• Outdated Information: The advocacy letters and studies in question were published or issued between 2004 and 2014. With the rapidly evolving healthcare landscape and significant changes in the PBM industry since then, these materials no longer accurately represent the current market realities and practices of PBMs.
• Evolving PBM Industry: The PBM industry has undergone substantial transformations over the years, including changes in regulations, business models, and market dynamics. The Commission recognizes that relying on outdated materials could lead to misguided decisions and policies that do not align with the current state of the industry.
• Ongoing FTC Study: The Commission is actively engaged in an ongoing study of the PBM industry to update its understanding of the sector and its practices. This study is essential for gaining a comprehensive and up-to-date perspective on the challenges and opportunities within the industry. As such, relying on old advocacy statements and studies may hinder the progress of this critical investigation.
• Opposition to Transparency and Disclosure Requirements: The cautionary statement highlights that PBMs have been using older FTC advocacy materials to oppose mandatory transparency and disclosure requirements. This indicates a potential bias towards preserving a lack of transparency in their operations, which could adversely impact consumers and other stakeholders.
• Ensuring Accurate Decision-Making: The Commission’s primary role is to promote competition, protect consumers, and make informed policy decisions. By issuing this cautionary statement, the FTC aims to encourage stakeholders to base their decisions and arguments on the most current and reliable data available to ensure fair and effective regulation within the PBM industry.
• Fairness and Consumer Protection: The cautionary statement is part of the Commission’s commitment to fair competition and consumer protection. Relying on outdated materials may result in policies that do not adequately address present challenges or adequately safeguard consumers’ interests.

By providing these reasons, the Federal Trade Commission seeks to promote a more informed and accurate discussion surrounding PBMs, ensuring that decisions are based on the latest data and understanding of the industry’s dynamics.