Services offered by PBMs

January 1, 2006

Most PBMs will need to continue to work harder and smarter to bring value to their customers, say industry experts.

"This is because of increased focus on business practices [transparency], reduced rebate yields because of larger numbers of drugs coming off of patent, and increased pressure to find ways to constrain drug cost increases other than simple cost-sharing," says Lou Hutchison, president, HealthTrans, LLC, a pharmacy benefit administrator in Greenwood Village, Colo. "Therefore, we'll see greater emphasis on operational efficiencies, more patient education, benefit analysis and resultant modifications and greater awareness of outcomes for specific therapies-not necessarily brand 'A' vs. generic 'B', but also dosage and impact of compliance."

Prescription Solutions, a pharmacy and medical management company based in Irvine, Calif., agrees that there is a growing awareness of the value of clinical management by PBMs to improve medical outcomes and produce a true low net cost result. "MCOs and employers are looking for partners who understand that a PBM's services should be more than purchasing, fulfillment and processing claims," Edmund Pezalla, MD, MPH, vice president, medical director, Prescription Solutions, says. "The savings from discounts and rebates should be negated if prescription drugs are not managed to optimal utilization and therefore, improve health and productivity. These measures must be factored into any evaluation of the value of a PBM."

PART D PLAYS A ROLE

Part D could provide initiative for carved-out insured pharmacy benefits, Hutchison says. "PBMs have shied away from risk but have been required to by Part D," he says. "If successful, the practice may bleed over into the commercial space. The ultimate focus will still be on cost savings."

Expertise in the clinical management of drugs for seniors should be a priority for MCOs seeking PBM partners for Medicare Part D programs, or for their retirees, Dr. Pezalla says. "The ability of PBMs to offer options such as a 'wrap' program, in which the Medicare Part D benefits are supplemented by other benefits funded by the payer, are attractive to many payers," he says.

"We will see a continued trend in greater consumer/patient participation in benefit spending decisions manifested by more than a three-tier copay structure," Hutchison adds. "Part D is likely to place more focus on and legitimize the concept of paying for things like medication therapy management and e-prescribing."

Specialty pharmacy is a management service that payers should require, says Dr. Pezalla. "This category is growing twice as fast as other drugs; these complex medications can dramatically improve quality of life and health of patients and often are the only drug regimen for a given condition," he says.

–Tracey Walker