Four Critical Aspects You Should Know When Selecting a Pharmacy Partner
As a plan sponsor, you are entrusting your pharmacy partner with your money. Here are things you absolutely must demand that your pharmacy partner do for you.
In the complex landscape of pharmacy benefits, it is imperative for organizations to demand transparency and accountability from their pharmacy partners. They work for you, not the other way around. You are entrusting them with your money and you have every right to know how they are managing it on your behalf.
Here are four critical aspects that should be non-negotiable when it comes to selecting and working with a pharmacy partner.
#1) Transparency in drug pricing and contract terms
How the money flows in the pharmacy process is important, but fundamentally, if the pharmacy vendor is performing an administrative service, shouldn’t they just be paid an administrative fee?
Transparency means a million different things, of course, but to start, just look at rates. Rates matter but how they are defined and calculated matters more. A minimum discount of AWP-20% is NOT better than AWP-15% just because it looks like it is.
It all boils down to transparency. The terms in your contract define the way you will pay for the drugs your members use. Make sure you are 100% on the same page with your pharmacy partner so you aren’t surprised about what you are really paying.
#2) Tools and autonomy to manage your program your way and maximize the engagement return
Your pharmacy partner should provide the tools and recommendations you need to make informed decisions. They should provide you with their insights into (a) which drugs you should cover, (b) when you should cover them, and (c) what data you should use to make decisions.
On top of this, they should also give you the autonomy to manage your plan your way. That isn’t to say that you should be left to fend for yourself. Rather, it means you should expect rigorous support and intelligence related to the market, pipeline, trends, etc. to help support you and your trusted advisors—while giving you control and optionality.
#3) Visibility into the black box
You select a pharmacy partner because they are experts in pharmacy benefits. They stay on top of the trends, and they know all of the moving pieces of the pharmacy care process. Therefore, you should require that they share this knowledge with you, so you too understand how it works. This is about more than just transparency. Take something as seemingly small as the Maximum Allowable Cost (MAC) list. Knowing how it works and making sure it’s not harming your programs’ performance is surprisingly rare!
Perhaps you don’t want to cover certain products that are low value and high cost, but how do you do that if you don’t know what they cost? For example, Taltz® and Cosentyx® are both in the same drug class prescribed to treat psoriatic arthritis and are equally effective. However, Taltz is ~$2000 and Cosentyx is ~$7,000.
Bottom line: Get visibility into every moving part of your plan. This should include the ability to independently audit the program to understand what is working or not and why.
#4) Expense control and elimination of waste, redundancy, and excess
At some point, you must make decisions on what not to cover, what to require a prior authorization for, and what to limit.
And that’s not all. You will be constantly challenged to look for oddities that occur in your spend. For example, how do you address hoarding of prescriptions (stockpiling), as well as drug shortages causing a mor e expensive replacement? What about the OB-GYN physician practice that writes 96% of their prescriptions for Ozempic? Do you plan to pay for non-FDA approved medications?
A vigilant pharmacy partner would have programs in place to catch these issues. Challenge them by asking questions, and audit down to the claim level.
As organizations navigate the intricacies of the pharmacy benefits channels, these four critical aspects emerge as crucial pillars for a successful and mutually beneficial partnership. You must remember that your pharmacy partner is simply your agent, holding your money, spending it on your members. It is your right to know every detail of how they are making this happen – and how to improve.
