The Employer's Guide Blog for Overseeing PBMs

The Definition of Oversee: to watch over and direct (an undertaking, a group of workers, etc.) in order to ensure a satisfactory outcome or performance.

Ohio attorney general sues pharmacy benefit managers, calling them ‘gangsters,’ [Weekly Roundup]

Ohio attorney general sues pharmacy benefit managers, calling them ‘gangsters,’ and other notes from around the interweb:

  • Ohio attorney general sues pharmacy benefit managers, calling them ‘gangsters’. The music has stopped. Calling them “modern gangsters,” Ohio Attorney General Dave Yost on Monday accused pharmacy benefit managers of illegally driving up drug prices for patients who rely on insulin and other key medications. “Medications shouldn’t cost an arm and a leg, metaphorically or literally,” Yost said in a written statement. “Insulin is just a symptom of the problem; PBMs are the disease.” Yost filed a lawsuit in Delaware County Common Pleas Court against Express Scripts, Prime Therapeutics, Ascent, Humana Pharmacy Solutions and two parent companies. He alleges the companies colluded to control drug prices and have failed to live up to promises to negotiate lower drug prices from manufacturers and deliver those savings to patients. Instead, Express Scripts created a complex ‘pay to play’ rebate scheme that pushes manufacturers to boost drug prices to get their medications on preferred lists.
  • The CAA will ensure that doing the right thing is the only option. The CAA will soon begin holding employers accountable for upholding their fiduciary responsibility and exploring insurance options that lower the cost of employee health care. Word is circulating that the CAA may allow employees to sue employers if they don’t effectively manage their health care benefits. Even though the idea of employees taking legal action against their employers regarding health care benefits sounds terrible, if this interpretation is correct, it should have a positive effect on the health care industry. Should employers be worried about this new eventuality? No, not all of them. Most employers want to help their people — they just don’t fully understand that they have options. The new CAA guidelines will push employers and their brokers to explore other avenues that lower health care costs. It is simply establishing a framework to protect employees from medical debt — the leading cause of bankruptcy in the United States.
  • Claims Cost Transparency: Using Data to Optimize Medical Benefits Costs. Employee benefits are the second largest budget item in employee compensation, with medical benefits consuming the bulk of that cost. Yet, companies with fully insured medical plans often have limited financial transparency and control when it comes to managing these costs. Try viewing the actual, full cost for a broken ankle, and you’ll see that pricing is not so transparent. Companies that know and understand their medical & Rx claims can make decisions that will improve plan utilization and reduce overall costs. Claims cost analysis allows you to drill down into the data and see what you need in your health plan to boost utilization and get your employees and their families better care. Many small and mid-size companies have fully insured plans, allowing for a fixed monthly cost. The carrier creates a pool, lumping your company with others. The carrier may determine your rate based on costs for the entire pool, meaning you’ll pay a set cost whether your company’s claims are higher or lower than average. When it comes to data, however, fully insured plans may not provide transparency or flexibility. They offer some claims data, but the carrier owns all of it, including your high claimant utilization.
  • The 2023 specialty drug pipeline. “We’re in a whole new world. The specialty world has taken over,” said Jeffrey Casberg, M.S. Casberg, senior vice president of pharmacy of IPD Analytics, and his colleague, Leslie Fish, Pharm.D.. vice president of pharmacy at the Aventura, Florida, pharmaceutical analytics, and consulting firm, gave an hourlong tour of that world on the final day of the annual meeting of the Academy of Managed Care Pharmacy in San Antonio. More specifically, they thumbnailed the thirty-one specialty drugs in late-stage development that have been or are likely to be approved by the FDA this year. It is a group that includes the first gene therapy for hemophilia A and Duchenne muscular dystrophy, the first treatment for a rare neurological disorder called Friedreich’s ataxia that may have off-label uses, a third anti-beta amyloid drug for Alzheimer’s disease, an oral treatment for Clostridioides difficile that might preferable to treatment delivered rectally that is currently on the market, and three different vaccines for respiratory syncytial virus, one of which is going to have Magic Johnson as a spokesperson. Nearly 80% of the drugs that the FDA is expected to approve this year are specialty drugs, a category that is getting increasingly difficult to define but includes drugs for rare diseases or need special handling.

Tyrone Squires, MBA, CPBS

I am the proud founder and managing director of TransparentRx, a fiduciary-model PBM based in Las Vegas, Nevada. We help health plan sponsors reduce pharmacy spend, by as much as 50%, without cutting benefits or shifting costs to employees.

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