By Elijah Marentette, Senior Vice President of Account Management, myMatrixx
Last week, my colleague David Dubrof shared some important insights on the so-called “transparent” pricing models that some newer entrants to the pharmacy benefit management (PBM) arena are touting as an innovation in the field. He is absolutely correct that all payers need to stay focused on the overall power of a PBM program to meet their claims management goals and not get distracted by pricing schemes. David also emphasized that more established PBMs have direct pharmacy contracts that can help negotiate lower prices.
I think a very important idea to add to this discussion is that a PBM being “transparent” is not new. In reality, workers’ comp payers working with an established PBM will always know exactly what they’re paying, and the value they’re receiving.
Seemingly lower-cost pricing models should be met with scrutiny. Often, these can simply be an attempt to carve out basic services that established workers’ comp PBMs have always provided.
How a traditional workers’ comp PBM delivers real value — and transparency
To put it simply and clearly, any workers’ comp payer working with a PBM will have access to very clear information about the total amount paid for medications. There will also be a detailed cost breakdown of how that money was spent. This should include how much was spent on brand-name medications, generic medications and where there are any applicable cost savings through the PBM’s pharmacy network.
In workers’ comp pharmaceuticals, payers need a deep understanding of how certain factors may be affecting their claims program. From both a patient safety and cost standpoint, payers need to be sure that appropriate drugs are being prescribed and that if a suitable generic exists, it is being utilized. Doing this is no easy task.
It requires a PBM with intensive clinical and statistical analytics programs to ensure that workers’ comp formularies and regulations are being followed. Working with an experienced workers’ PBM can give a claims manager sleep insurance knowing that the right compliance programs are in place.
Consistent clinical oversight to put the “M” in PBM
One of the most basic elements of a high quality workers’ comp PBM program is the ability to communicate with a clinical pharmacist on a regular basis. Such access has great value to adjusters and case managers — as well as to the patients they serve — but that availability isn’t universal. With a traditional PBM model, access to and advice from clinical pharmacists is included along with oversight and management of the formulary.
PBMs in workers’ comp should also be equipped to provide clinical alerts that tell customers when something might not be going right. For example, if there’s a potentially dangerous mix of drugs prescribed, or if there is a particularly high dose of a medication and there is a legitimate therapeutic alternative.
Being able to recognize and respond to these and other issues should be a fundamental part of any workers’ comp PBM program. Basically, it’s prioritizing the management aspect of pharmacy benefits management and minimizing the possibility of runaway claims.
Delivering deep technical integration
Another core value that a PBM with a dedicated work comp focus like myMatrixx can offer compared to a less mature market participant is deeper technical and logistical integration with customers and their claims systems. Being able to interface smoothly with the components of different payers’ systems and procedures is a highly complex process. Often, this requires custom solutions that have to be built, maintained and enhanced on a day-in-day-out basis over a period of years.
These systems also need to be secure and backed-up with sufficient recovery capability, whether from natural disasters or other emergent events. Clients who depend on their PBM to be there for their patients should be sure that the PBM they’re working with has the size, scope and resources to provide the necessary level of service and security.
Often, one way that a “streamlined” PBM relationship can achieve the value they advertise is by scaling back on key technical service and logistical capabilities. Clients may be paying less up front, but that could mean paying more in the long-run due to inefficiency, unavailability or even losing data.
Are you asking the right questions about rebates?
Last week, David covered rebate sharing and how the drug rebate headlines coming to the workers’ compensation PBM space are overselling the role rebates play in controlling costs. I agree. It is important for payers to know that rebatable name-brand drugs just don’t play a comparatively large role where injured workers are concerned.
There are certain cases where a name-brand rebatable medication will be the most clinically appropriate treatment for an injured worker. In these cases, a PBM should be fully utilizing negotiated manufacturer discounts. However, being able to do this efficiently and safely requires the clinical oversights and technical systems mentioned above. In far more situations, a partner acting in their clients’ best interests will be maximizing the percentage of generic drugs dispensed when available. To underscore what David said previously, myMatrixx delivered at or near 100% generic efficiency for all of our clients last year while still ensuring a clinical-first approach that gives injured workers access to the medicines they need.
A great example of this was our rapid response to the expiration of the patent for Lyrica. When generic pregabalin came to market, our entire team moved swiftly to ensure that we converted 91.8% of any appropriate prescriptions to the generic within four weeks and 96.4% within 180 days.
It’s important to remember that payers are only getting their own money back with rebates. What’s more, this money can come with substantial administrative costs to credit the rebate properly back to the original claim. On top of all that, whether for rebates or direct drug pricing, larger PBMs with direct pharmacy network contracts can often negotiate better prices.
That’s why when discussing rebates with a PBM, clients should always scrutinize plans by using the following questions: What is your generic efficiency rate? What are your administrative costs? Do you have a direct contract with your pharmacy network? Do you negotiate directly with manufacturers for rebates, or do you have to go through an aggregator? How much does the aggregator charge before you receive the rebate? If you can’t get transparent answers here, there’s a good chance you won’t be getting the savings you were advertised. The best savings results from claim dollars not spent rather than from claim dollars rebated.
How a PBM should measure success
For a workers’ comp PBM, true cost transparency should come in the form of tangible measurement of results. Clients deserve clear reporting on factors like generic efficiency, network penetration, and the overall savings amount versus what was charged. Those are the measures that have been around for years and that established PBMs, like myMatrixx, have used to help payers measure exactly how their program was working.
When we talk to a client about improving their program, we talk about increased connectivity that goes deeper and wider to meet claims and medical management goals. A larger PBM, with a dedicated focus on workers’ comp will have the technical, statistical and clinical ability to integrate into claims management and underwriting systems and send appropriate and understandable clinical alerts to claims professionals. People and technology can help enable the adjustor with what we call clinical alerts sent directly to their claims system. The goal is to make managing workers’ comp pharmacy both predictable and affordable.
When you think about the total cost of ownership of a PBM, there’s more than just what you paid for a drug and what you get back in a rebate. It’s about clinical oversight, statistical acumen, network ownership and technical integration. Getting real value for the money you’re spending is what impresses your clients for the long-term.
About Elijah Marentette
Elijah Marentette joined myMatrixx in November 2018 as Senior Vice President, Account Management, where he is responsible for leading our extensive team of Account Executives and Account Managers. His team is at the center of maintaining and strengthening all client relationships so that we achieve the best possible outcomes for their injured workers.
Prior to joining myMatrixx, Elijah held various executive positions at Coventry since 2010. Most recently, he was the Vice President of the Local Sales and Service team. Prior to that, he held the position of Vice President of IME Operations.
Elijah worked in Concentra’s Auto Injury Solutions unit beginning in 2005 as the Vice President of National Accounts and later held the position of Vice President of Bill Review Operations.
Elijah previously held the positions of Vice President of Product Management and Senior Manager of Product Development with Concentra. He was responsible for: (1) the design and delivery of a claim file-imaging product; (2) the ongoing design, development and implementation of a web-based employer, payer and provider-focused product and (3) the development of the industry’s first internet-deployed claim reporting tool.
Elijah holds both a Bachelor’s and a Master’s degree in economics from Boston University. He resides in Washington, DC with his family. In his spare time, he enjoys racing sailboats, skiing and playing baseball with his kids.
About myMatrixx, An Express Scripts Company
myMatrixx® is a pharmacy benefit management company laser focused on workers’ compensation. The unique combination of myMatrixx and Express Scripts makes us the only workers’ compensation PBM that can deliver customized solutions and exceptional customer service while leveraging Express Scripts’ pharmacy network, comprehensive clinical team, mail order program and specialty solutions to meet the individual needs of our clients and their injured workers. For more information, visit myMatrixx.com.
Disclosure:
myMatrixx is a WorkCompWire ad partner.
This is not a paid placement.