Tuesday, October 12, 2010

State of the Profession......PBMs

A couple month ago I had a little post on pharmacy benefits managers and some of the tactics they use in the course of their business. The post focused on how PBMs use any and all means at their disposal to pay the absolute minimum for medications. From a business standpoint, I would expect nothing less from them.

But they do engage in some practices that, even though the practices are not part of the practice of pharmacy, end up shaping the opinion people have about pharmacists. We've all been put in the situation where we have to basically explain to the patient why their copay for a particular angiotensin receptor blocker is 85 bucks this month when it was only 15 dollars last month.

Patients don't want to hear that their insurance company has shifted the cost to them. Their perception is that the pharmacist is trying to price gouge them. Never mind that the actual reimbursement to the pharmacy is $2.40 over our actual acquisition price.

Then we have the nice little practice where the PBM requires that the patient utilize the mail-order service (or a particular retail chain) for their maintenance medications. This forces the patient to choose between staying with their preferred pharmacist (and paying a substantial penalty) or utilizing the PBMs choice of pharmacy (and realizing the full benefits of the insurance). Given the economic situation that most of our patients are in, they choose to use the PBMs preferred pharmacy.

Combine these little tricks with all of the hoops that insurers require us to go through just to get Mr. Jones a two-week supply of his carvedilol until his mail-order arrives and it's pretty easy to see why pharmacists don't really like PBMs. What should be a partnership to keep our mutual patients healthy has turned into an adversarial situation on each claim that we submit.

In my opinion, pharmacy benefits managers have too much say in the practice of medicine/pharmacy today. Rather than letting the health care practitioners select the best medication to treat a condition, a group of accountants are making the decisions.

Part of this is due to the manner in which pharmacy benefits managers are set up. PBMs exist solely to adjudicate claims. That's it. They have no vested interest in the overall health-care outcomes of the patients that they cover.

In order to truly treat the patient and not the corporate P & L, PBMs should be required to be part of a larger health care insurer. It has been my experience that insurers who manage both medical claims and prescription claims tend to manage the patient better than insurers who handle just the drug portion of the insurance. Insurers who handle both medical and prescription claims know that sometimes the more expensive medication is what actually is best for the patient and will help decrease health care expenses over the long haul.

If insurers had to cover both medical and prescription claims, we might be able to really advance the concept of medication therapy management. But as it stands now, only pharmacies can contract with the PBMs (with a few exceptions) and pharmacists are blocked from being providers for major medical plans.

If pharmacy benefits managers were truly interested in the benefits that pharmacy can provide, we would see them reach out to us in an attempt to help them control their costs by utilizing the specific skill sets that pharmacists possess. As it stands now, the only benefits the PBMs are interested in are their bonuses at the end of each fiscal year.


PAS said...

Since I'm personally in this field, I've got a good bit to say on the topic. So. Ahem.

There are some definitively sleazy practices in the PBM world. Mail order or retail chain utilization is one of the worst, since it deprives the patient of a huge amount of options. This is not a universal of course, many plans allow unrestricted use of retail pharmacy and simply offer the industry standard of discounting 1 month's copay on 3 months of meds at mail order. This is not the sort of plan or policy that's an issue.

What is a problem is when plans require that a patient use a mail order pharmacy for 'maintainance' medications, typically allowing only one to two fills per year at retail. This practice is primarily associated with union-sponsored commercial insurance (in which case it is the plan sponsor dictating the policy to the PBM), and Caremark managed plans - in which case it is Caremark being scummy. While this shows up on other plans and PBMs, these two are the big offenders in this area. In my opinion, a reprehensible practice that offers little benefit to the patients, debatable financial benefit to plan and patients, and should just flat out be ended.

The issue of retiering, or altering the preferred schedule of medications is problematic. In the case of most commercial plans, this happens whimsically, and subject to getting a good rebate deal from one brand over another. There's little effort to inform the patients or providers, and such things pop up as surprises. This is substantially less frequent in Medicare Part D plans. In PDPs, CMS must sign off on all formulary changes happening during the year. They take a notoriously dim view of moving drugs up to higher tiers from lower ones. However, at the beginning of a plan year (eg, January when new PDP plans start), this can happen. Since PDPs don't have the ability to negotiate for drug prices (at least with any freedom compared to commercial insurance), tier structure typically reflects the economic reality of the market at the time. This can leave patients high and dry.

On Medicaid plans, this is a different issue and more frequent. Medicaid plans get rebates on their prescription drugs through the federal Medicaid Drug Rebate program. This program basically forces drug manufacturers to offer rebates similar to the best deal they offer commercial clients to Medicaid. It was created, in part, because of practice of drug makers to discount to large commercial plans that could leverage their member bases for better prices, and pass the increased cost on to state sponsored plans that insured the low-income and disabled group.

While the program offers some substantial benefits - state Medicaid programs can often get brand name drugs at better prices than generics, there's a downside as well. Of a drug maker changes their prices and rebates, it can result in a drug price increasing many times over. A Medicaid plan that encouraged its members to use a particular drug due to its low cost can run into a situation where the monthly price of that drug increases many times over. Given their tight budget, they're faced with a choice between changing what they cover (and pissing off patients and providers), or having their drug program financially eviscerated.

The one thing I really take issue with is the statement that a group of accountants are making the decisions about the practice of medicine. These decisions regarding formulary coverage, clinical guidelines and such are being principally made by a P&T committee, similar to that in any hospital - a group of pharmacists and physicians.

H ave more to say, unfortunately I'm running late.

lovinmyjob said...

I had the following conversation with a PBM this past weekend:
ME: My patient's plan limits him to 12 cialis in a 30 day period. His last fill was on 9/9, today is 10/10 so why is my claim not going thru
PBM: Your patient is limited to 12 tablets in 30 days.
ME: Yes, I know, I just told you that. My question is why. I have to explain this to him so I need you to explain it to me.
PBM: Your patient is limited to 12 tablets in 30 days. His last fill was 9/9 so this claim will go thru on 10/11.
Me: So its not 30 days its 32 days?
PBM: That's correct
ME: You just told me it was 30 days.
PBM: That is correct.
ME: So, which is it 30 or 32.
PBM: your patient is limited to 12 tablets evey 30 days.
Me: OK. Do you have a calendar in front of you.
PBM: Yes ma'am I do.
Me: Ok go to 9/9 and count of 30 days. That will actually take you to 10/8. As I said before, today is 10/10 so why is my claim not going thru?
PBM: Your patient is limited to 12 tablets every 30 days.
Me: Listen, I know your just doing your job but could you try to think instead of just reading from a pre-written dialogue.
PBM: Your patient is limited to 12 tablets every 30 days. The claim will process on 10/11.
ME (very frustrated at this point): I don't know what day it is where you live but today is 10/10. If you are not in the same hemisphere as me then I would like to speak to your supervisor.
PBM: OK hold please.

This conversation actually repeated itself with the supervisor. Bottom line: the patient did not get his medication that day and was very angry. Now, I know that some of you might say, "So what, it was just Cialis", but I've had this exact same conversation over a migraine patients tryptan.

PAS said...


It's called a Period Quantity Edit. Essentially, when you try to process a claim, the system takes time the claim is processed and rolls backwards over a certain time period, counting each unit of the medication. If before they reach the end of period, they exceed the set quantity, the claim rejects with code 76.

They're -extremely- literally minded, and will count backwards to the second. They're also one of the most extremely difficult implementations to deal with, and are not frequently used (triptans and ED meds are one of the few that commonly use it). Quite frequently a plan will sloppily document them - writing in their documentation, '12 pills per month' - where in the system it's actually set up as 12 pills within a 31 day period. Quite literally the only way to deal with them is to open up the in-software implementation of the drug formulary and read it out. Rather few techs are literate enough to do so.

Regardless, they're profoundly frustrating because they operate very counterintuitively especially given the way the rest of pharmacy operates. They're rarely used, so few can identify them and explain them well

Also triptans. Don't even get me started. I think one of the first times I was really sick in this business was when I saw a Sumatriptan TID #90/30days. That sort of thing is why they bother to put these things in there.

PTR said...

The future of PBMs is evolving. Independent Pharmacy has a chance to fight the major 3 PBMs that have stock holders in mind and NOT patient care. Pharmacy benefit managers (PBMs) were designed to simplify transactions between pharmacies and health-plan sponsors for prescription-drug claims. However, the big PBMs have become behemoth drug middlemen that disproportionately influence healthcare decisions while maximizing their profits, often to the apparent detriment of patients, plan sponsors, and pharmacies. As small businesses, independent community pharmacies are subject to some of the most abusive PBM practices.

In response, Translucent Pharmacy Benefits is dedicated to pushing pharmacy services for the local community back to the Independent Community Pharmacies. The big national PBMs prosper by exploiting a non-transparent, non-accountable system. We believe medication management should be between the patient, doctor, and the local pharmacy – not the PBM and an unattached mail order pharmacy.

Translucent Pharmacy Benefits core values are to ensure better patient care through our transparent and simple pharmacy benefits model that keeps the local Independent Community Pharmacy involved in community healthcare.