People who know Pharmacy Benefit ManagementAuditing is the tool used by managed care organizations, insurance companies, self-funded employer, drug manufacturers and state and local governments that employ pharmacy benefit managers to verify that they are being billed for the correct contracted network rates, rebates and administrative fees. It is a good idea to examine the practices of the vendors you are put so much faith in and trust to handle such a large portion of the benefit funds.
For any health plan sponsor, the problem is multi-faceted. First, it is likely that there is a spread between the AWP reimbursement to the pharmacy and the AWP bill submitted to the payor. Second, PBMs are responsible for setting up and assuring compliance to the sponsor’s benefit plan. Third, PBMs are expected to maintain principled and professional relationships with community pharmacies and not drive them out of business. In terms of contracting and rebates, there are times when different departments within a PBM are at odds, there can be a conflict of interest. Lastly, Payors need a PBM to monitor waste, abuse and fraud and make provision to reduce or eliminate these concerns.
Audits can range from high level to a level of detail reviewing PBM system edits. If the promised results are not showing, the plan sponsor needs to uncover the problems and can do so through an audit. All items identified for recovery need to be documented back to the Payor for review and action.
Areas for review covering both retail and mail order prescriptions are:
- Network Claims Pricing
- Rebates
- Benefit Plan Design
- Administrative Services
- Clinical Programs
- Fraud and Abuse
- Performance Guarantees
A Plan Sponsor should always validate their PBM’s contract terms, performance guarantees and savings promises.