What do Ticketmaster and Pharmacy Benefit Managers have in common and other notes from around the interweb: Accumulators And Maximizers: A New Front in the Battle Over Drug Costs. At the time the patient presents to the retail pharmacy and uses the copayment coupon, the retail pharmacy (which contracts with the PBM) enters the amount of the coupon in the adjudication system. The PBM notes this part of the transaction and deducts the value of the coupon so that it does not “accumulate” against the deductible. (The pharmaceutical assistance program also notes the value of the coupon, as the programs do put limits on the amount of assistance available.) The beneficiary still avoids the copayment cost at least until she hits the limits on the copayment program, when the coupon ceases to become available and the patient must begin to pay, reinstating the original incentives. From the payer’s point of view—either the self-insured employer or the insurer—the effect is financially salutary. Some pharmaceutical firm funds help pay for the initial costs of the medication. But eventually, the deductible and copayments come back into play and promote consumerism. Yet, as the coupon limits come into play, the beneficiary faces challenges from out-of-pocket spending, and adherence can drop. What do Ticketmaster and Pharmacy Benefit Managers have in common? Popular American singer and songwriter, Taylor Swift, released her newest album ‘Midnights’ in October. The album quickly became the most-streamed album in 24 hours on Spotify, with 184.6 million streams, according to Guinness World Records. Following the release, the artist sought to work with Ticketmaster, a company who arguably has a monopoly on all ticket sales in the country, for pre-sale tickets for her new ‘Eras’ tour. But shortly after online pre-sale started for the tour on Tuesday, November 15th, Ticketmaster canceled the public on-sale that was supposed to take place on Friday, after the site had sold two million tickets and saw long wait times and temporary outages. How is Ticketmaster getting away with this? Pharmacy benefit managers (PBMs), like Ticketmaster, are third-party administrators of prescription drug programs that are primarily responsible for processing and paying prescription drug claims. As Wayne Winegarden notes in his study, “The Economic Costs of Pharmacy Benefit Managers,” due to their government sponsored ‘near-monopoly’ position, PBMs can charge fees that are high and retrospective. Click To Learn More Getting off the PBM Merry-go-Round: How Late-stage Offer Tricks Take Employers for a Ride. Monies offered by PBMs come in many forms – a general allowance credit that the client can use to pay for claims and expenses during open enrollment and implementation, an administrative credit that the client can use to pay back to the PBM for administrative fees, a clinical credit that the client can use to pay for voluntary clinical programs administered by the PBM or, at times, slightly improved pricing. If it seems odd that two of these credits go towards paying back the PBM for additional services, that’s because it is. Employers should think of…

In a statement released last week, the FTC reaffirms commitment to unfair business practices. Beyond what is covered by the other antitrust provisions, Congress granted the Federal Trade Commission (FTC) the exclusive power to detect and enforce this conduct. However, the agency hasn't always consistently fulfilled this duty in recent years. By limiting its oversight to a more limited range of situations, the FTC's previous policy made it more difficult for the agency to address the whole spectrum of anticompetitive behavior in the market. With the recent announcement, this restriction is lifted, and the agency states its intention to use all its statutory power to take legal action against businesses that take unfair advantage of their competitors rather than engaging in fair competition. Congress created the Federal Trade Commission Act in 1914 as a result of dissatisfaction with the Sherman Act's enforcement, the first antitrust law. The FTC Act's Section 5 prohibits "unfair methods of competition" and directs the Commission to uphold this rule. Register for CPBS today! According to the policy statement, unfair methods of competition are strategies that aim to acquire an advantage without engaging in a merit-based competition and that are likely to lessen market competition. The Commission's strategy for policing them is outlined in the Policy Statement. It is the outcome of several months' worth of collaboration between agency departments. Staff members combed through hundreds of Commission decisions, consent orders, and court rulings—including more than a dozen Supreme Court opinions—to examine the legislative background of Section 5 and its interpretation. The agency will follow the rich case history as it applies Section 5 to its operations. The Commission will warn firms about how to compete fairly and legally through enforcement and rulemaking. This is without a doubt a prelude to the FTC's inquiry into pharmacy benefit manager (PBM) practices. Those stakeholders seeking change, for the better, in pharmacy benefit manager practices are eagerly awaiting the commission's final report. PBMs are a crafty bunch. They've already made moves to protect margins from any FTC decision that might curtail PBM revenue streams that are bad for customers.

Consolidated Appropriations Act shifts more responsibility to employers next year and other notes from around the interweb: Centene gives politicians millions as it courts contracts and settles overbilling allegations. On Nov. 2, 2021, Nevada Gov. Steve Sisolak’s reelection campaign received ten separate $10,000 contributions from unrelated health insurance plans from across the country. The Buckeye Community Health Plan of Ohio, Louisiana Healthcare Connections, and Peach State Health Plan of Georgia were among the companies that sent money to the Democrat, according to state campaign finance records, even though only one, SilverSummit Healthplan, provided insurance in the Silver State. But a thread connects the companies: Each is a subsidiary of Centene Corp., ranked 26th on the Fortune 500 list, and the nation’s largest private managed-care provider for Medicaid, the government insurance program for people with low incomes or disabilities. Centene had already sealed Medicaid deals in Nevada through its SilverSummit subsidiary — yet a potential new line of business was on the horizon. Sisolak, who is up for reelection Nov. 8, had just approved a new public health plan option that would later open to bidding from contractors such as SilverSummit. And then, less than two months after Centene’s subsidiary contributions were made, Nevada settled with the company over allegations the insurer overbilled the state’s Medicaid pharmacy program. The state attorney general’s office did not announce the $11.3 million settlement but disclosed it in response to a public records request from KHN. 4 questions to ask before signing your next PBM service agreement. The very idea of managing pharmacy benefits might make you nauseous. That's because drug prices are skyrocketing, creating significant challenges for your company's bottom line. You may think that your pharmacy benefit manager (or PBM) – who is responsible for handling contractual relationships between drug manufacturers, health insurance providers, pharmacies, and patients – would negotiate the best possible deals for everyone involved. Unfortunately, recent reports from the PBM Accountability Project show otherwise: PBMs often misuse their immense power by adding secret streams of revenue for themselves. The Federal Trade Commission (FTC) has noted this trend too and announced plans in 2022 to investigate the inner workings of PBMs. But some states are taking it upon themselves to crack down on PBM business dealings, too. For example, Florida and Iowa joined Michigan in passing legislation in 2022 that regulates certain PBM practices – while Ohio's Medicaid department is also conducting audits. Click To Learn More Is prescription copay assistance contributing to rising drug prices? Why buyers should beware. Drug manufacturers say they offer coupon programs to help patients offset the rising out-of-pocket cost of prescriptions due to health insurance plan design changes. “Every day there are patients who show up at the pharmacy and find their commercial insurance won’t cover the cost of their medicine," said Brian Newell, spokesman for the drugmaker trade group Pharmaceutical Research and Manufacturers of America. "To help fill these gaps in insurance coverage, biopharmaceutical companies offer coupons and other forms of patient assistance." Pharmacy benefit…

https://youtu.be/aoDDfS0TNsg The list of methods in which bad PBM revenue streams are created is long. They include but are not limited to: ClawbacksBallooningDrug reclassificationBack-billingRebate spreadsIngredient cost spreadsDIR feesDifferential contractingPoor utilization managementPoor product mix I could go on, but you get the idea. Kick back, increase the playback speed to 1.5x or 2x and watch as I go into detail about PBM revenue streams. To learn more about bad PBM revenue streams, join the next Certified Pharmacy Benefits Specialist course. It starts on January 12, 2023! Only three online courses per year! The Certified Pharmacy Benefits Specialist (CPBS) program offers three different instructional formats: live online classrooms, in-person Knowledge Camps, and self-study. Every Thursday at 6 PM ET, the online class meets for roughly 1.5 hours. Every class is taped for later viewing. PBIA is approved by the Society for Human Resource Management (SHRM), HR Certification Institute (HRCI), American Council of Pharmacy Education (ACPE), and forty-six states to provide up to 20 recertification credit hours to licensed pharmacists, pharmacy technicians, life and health professionals, and human resources specialists. Since we began offering our courses in 2014, more than 1,000 students have earned the CPBS credential. “Thanks for everything throughout the course. The firm I work for is trying to get more involved in the Plan Sponsor space, and in doing so, we have been reviewing a lot of PBM/Plan Sponsor contracts. I can’t tell you how much more confident and comfortable I am working through these PBM contracts now and what I need to be looking out for.” – Adam Farkas, Esq. Associate Attorney

Because plan sponsors don't know how to calculate how much money pharmacy benefit managers (PBM) make, it gives PBMs all the incentive they need to overcharge. How many businesses do you know want to cut their revenues in half? That's why traditional pharmacy benefit managers, and their stakeholders, don't offer a fiduciary standard of care and instead opt for hidden cash flow opportunities to generate their service fees. Want to learn more? Click to Join Us Here is what some participants have said about the webinar. "Thank you, Tyrone. Nice job, good information." David Stoots, AVP "Thank you! Awesome presentation." Mallory Nelson, PharmD "Thank you, Tyrone, for this informative meeting." David Wachtel, VP "...Great presentation! I had our two partners at the presentation as well. Very informative." Nolan Waterfall, Agent/Benefits Specialist A snapshot of what you will learn during this 30-minute webinar: Hidden cash flows in the PBM IndustryBasic to intermediate level PBM terminologiesSpecialty pharmacy cost-containment strategiesExamples of drugs that you might be covering that are costing youThe #1 metric to measure when evaluating PBM proposals Understanding how PBMs make money and how much you pay them for their services is a key element in running an efficient pharmacy benefits program. Join us to learn more. See you Tuesday, 11/8/22 at 2 PM ET! Sincerely,TransparentRxTyrone D. Squires, CPBS  10845 Griffith Peak Drive, Suite 200  Las Vegas, NV 89135 Office: (866) 499-1940Mobile: (702) 803-4154 P.S. Yes, it's recorded. I know you're busy ... so register now and we'll send you the link to the session recording as soon as it's ready. 

Get ready for hemophilia gene therapies at $2M-$3M and other notes from around the interweb: ERISA-Covered Companies Must Disclose Health Plan Costs. Starting in 2022, an estimated 2.5 million employer-sponsors of health plans are required to adopt new fee and pricing transparencies due to amendments made to ERISA. While ERISA has focused on retirement service fees in the past, the spotlight is now on healthcare costs. The requirements fall under the Affordable Care Act (ACA) and Consolidated Appropriations Act, 2021 (CAA 2021), and affect organizations covered by the Employment Retirement Income Security Act of 1974 (ERISA). ERISA applies to most private companies that offer healthcare and retirement plans to employees. Complying with ERISA fiduciary duties for group health plans has been challenging due to the lack of fee transparency in the industry. However, the new transparency rules put more fee and pricing information into the hands of health plan fiduciaries and other stakeholders to shed light on these fees. 4 questions to ask before signing your next PBM service agreement. The very idea of managing pharmacy benefits might make you nauseous. That's because drug prices are skyrocketing, creating significant challenges for your company's bottom line. You may think that your pharmacy benefit manager (or PBM) – who is responsible for handling contractual relationships between drug manufacturers, health insurance providers, pharmacies, and patients – would negotiate the best possible deals for everyone involved. Unfortunately, recent reports from the PBM Accountability Project show otherwise: PBMs often misuse their immense power by adding secret streams of revenue for themselves. The Federal Trade Commission (FTC) has noted this trend too and announced plans in 2022 to investigate the inner workings of PBMs. But some states are taking it upon themselves to crack down on PBM business dealings, too. For example, Florida and Iowa joined Michigan in passing legislation in 2022 that regulates certain PBM practices – while Ohio's Medicaid department is also conducting audits. Click To Learn More Payers and PBMs are restricting access to birth control options, report finds. Several large health insurers and pharmacy benefit managers (PBM) are limiting access to birth control medication, according to a report issued by the House Oversight and Reform Committee this week. There are more than 30 birth control products that health insurers and pharmacy benefit managers are placing cost-sharing requirements on, the report found. In other words, these healthcare stakeholders are making patients pay to cover part of the prescription drug cost — or else restricting coverage. The Affordable Care Act (ACA) requires that private health insurance plans cover birth control options that are approved by the Food and Drug Administration without asking for copays. Among the 34 birth control products identified in the report, 12 don’t have equivalent options on the market. Get ready for hemophilia gene therapies at $2M-$3M. ICER says it's fair for BioMarin and CSL to price incoming hemophilia gene therapies at $2M-$3M. Get ready for million-plus-dollar gene therapies to become the norm rather than the exception, and in some cases, the…

In addition to 6 things every transparent PBM should do, PBM duties may include creating retail pharmacy networks, maintaining drug formularies, claims adjudication, and negotiating rebates with drug manufacturers. To help health insurance control drug costs, PBMs were developed in the 1960s. By moving demand among rival replacement medications, PBMs can encourage price competition among prescription drugmakers. Manufacturers also provide rebates to PBMs in exchange for having their medications included favorably on a pharmacy formulary. PBMs then pass these rebates on to insurance or employers. For rebates to truly benefit final consumers, the PBM industry must be transparent [i]. 6 Things Every Transparent PBM Should Do: Provide unrestricted access to claims data. Unions, health plans, health systems, commercial and public sector employers shouldn’t get any push back when requesting claims data. Minimum data elements include NDC, date dispensed, quantity, days' supply, and pharmacy identifier (i.e., NABP, NCDPD or NPI).Allow clients to terminate, for any reason, with 90 days' notice. Opaque pharmacy benefit managers are unwilling to sacrifice revenue streams that are bad for customers. Terminating one of these deals early requires an act of congress.Lower the copayment to match the total cost of the drug. Prescription drug overpayments (also known as “clawbacks”) occur when commercially insured patients’ copayments exceed the total cost of the drug to their insurer or pharmacy benefit manager[ii].Disclose or not take spreads. A spread is the difference between what a PBM takes in (cash) and the amount it pays out. Therefore, spreads occur with ingredient cost and rebates. Spreads are harmful when third-party payers are unaware or unable to perform a full accounting of the total amount of spread being paid.Deliver a 90% or better generic dispense rate (GDR). High GDRs are driven primarily by cost-effective formulary and drug utilization management programs.Provide every client with a rebate remittance report. A rebate remittance report is like a claims file with two additional data elements; rebate guarantee amount and rebate amount collected. Rebate remittance reports allow plan sponsors to compare notes. Sample Rebate Remittance Report 5 Things Every Transparent PBM Should Do What PBMs are (completely) passing on in rebates and network discounts is unclear. In fact, some economists contend that the PBM market's consolidation and opaque pricing are two factors contributing to rising pharmaceutical prices. Health insurers have started vertically integrating with PBMs, in reaction to this insufficient pass-through of rebates. Because of this, the biggest insurers in the nation as well as several smaller ones already own their own PBMs or share an owner with one. [i] Garthwaite, C. January 2022. Which Markets (Don't) Drive Pharmaceutical Innovation? Evidence From U.S. Medicaid Expansion. NBER. https://www.nber.org/system/files/working_papers/w28755/w28755.pdf [ii] Van Nuys, K. March 2018. Overpaying for Prescription Drugs: The Copay Clawback Phenomenon. USC Schaeffer. https://healthpolicy.usc.edu/research/overpaying-for-prescription-drugs/

How the 10 largest PBMs hold huge sway in health care marketplace and other notes from around the interweb: How the 10 largest PBMs hold huge sway in health care marketplace. The American Medical Association has gathered first-of-its-kind data on pharmacy benefit managers (PBMs) and its analysis finds a widespread high degree of market concentration in local markets across the U.S. where PBMs provide services to commercial health insurers. The AMA Policy Research Perspectives report, “Competition in Commercial PBM Markets and Vertical Integration of Health Insurers with PBMs” (PDF) presents the two largest PBM market shares and concentration levels for all states and metropolitan areas. The analysis found that 37% of the national markets for two services—formulary management and benefit design—were managed in-house by health insurers rather than buying those services from the PBM market. Commercial insurers largely use a PBM for three services—rebate negotiation, retail network management and claims adjudication—rather than conducting them in-house, which is why the report assesses market competition for those three PBM services. 4 questions to ask before signing your next PBM service agreement. The very idea of managing pharmacy benefits might make you nauseous. That's because drug prices are skyrocketing, creating significant challenges for your company's bottom line. You may think that your pharmacy benefit manager (or PBM) – who is responsible for handling contractual relationships between drug manufacturers, health insurance providers, pharmacies, and patients – would negotiate the best possible deals for everyone involved. Unfortunately, recent reports from the PBM Accountability Project show otherwise: PBMs often misuse their immense power by adding secret streams of revenue for themselves. The Federal Trade Commission (FTC) has noted this trend too and announced plans in 2022 to investigate the inner workings of PBMs. But some states are taking it upon themselves to crack down on PBM business dealings, too. For example, Florida and Iowa joined Michigan in passing legislation in 2022 that regulates certain PBM practices – while Ohio's Medicaid department is also conducting audits. Click To Learn More Payers and PBMs are restricting access to birth control options, report finds. Several large health insurers and pharmacy benefit managers (PBM) are limiting access to birth control medication, according to a report issued by the House Oversight and Reform Committee this week. There are more than 30 birth control products that health insurers and pharmacy benefit managers are placing cost-sharing requirements on, the report found. In other words, these healthcare stakeholders are making patients pay to cover part of the prescription drug cost — or else restricting coverage. The Affordable Care Act (ACA) requires that private health insurance plans cover birth control options that are approved by the Food and Drug Administration without asking for copays. Among the 34 birth control products identified in the report, 12 don’t have equivalent options on the market. Kroger seeks to end deal with Cigna’s Express Scripts over drug pricing. Grocery retailer Kroger Co said on Friday it has sent Cigna Corp’s subsidiary Express Scripts a written notice of its plan to…

3 Axis Advisors new report clears up misunderstandings about drug pricing benchmarks. The just released comprehensive report, Understanding Pharmacy Reimbursement Trends in Oregon makes general representations that are applicable to any state or group, not just Oregon.   Five key takeaways: The drug price benchmark (i.e., AWP, NADAC, MAC etc.) used to determine a drug's price does not matter when the PBM doesn't take a spread.An invisible floor exists on the reimbursement amount pharmacies are willing to acceptThen, what matters most is how close the billed (plan sponsor) amount gets to pharmacy reimbursement on a per claim basisNADAC is compiled from a voluntary monthly invoice cost survey of 2,500 randomly selected retail pharmacies with 450-600 respondents.Don't forget to tack on the dispensing fee (page 29) when comparing NADAC to AWP minus for ingredient cost analysis Medicaid Maximum Retail Dispensing Fees by State (2022) Conclusion, New Report Clears Up Misunderstandings About Drug Pricing Benchmarks This all assumes the PBM has negotiated aggressively with pharmacy networks. If not, all bets are off. The ability of a PBM to negotiate discounts and rebates varies with fire in the belly, experience, and education level of decision-makers sitting at the table.

https://youtu.be/L9GN3heEqPc