Sunday, December 9, 2018

Ninety-Two Percent of Self-Insured Companies Lack a Formalized Pharmacy Benefits Management Process

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This one is the proverbial head-scratcher. Nine out of ten self-insured companies do not have a formalized pharmacy benefits management process. The results from our phone poll were startling, to say the least. During Q1-Q3 2018, I asked the TransparentRx sales staff to pose a question to small, medium and large self-insured employers.

In the qualification stage of our sales process, we asked employers, "do you have a written plan to procure, monitor and evaluate your pharmacy benefits management service?" Of the 1017 self-insured employers who responded, here is what they shared with us.

For the process to be considered "formalized" each employer had to have a written plan. If the employer did not have a written plan we considered them not to have a formalized process. We could've easily stopped there as 81% of employers did not have a written plan.

Additionally, employers who professed to have a written plan (19% or 193 employers) were asked if their plan addressed the following seven sub-criteria:

1) Defined Team Roles
2) Reasonable Goals
3) Clear Objectives
4) Dispute Resolution Process
5) Monthly Performance Reviews with the PBM's Account Manager
6) Quarterly Meetings with the PBM's Executive Sponsor
7) Recurrent Training of In-House Staff who Oversee Pharmacy Benefits

If they answered no (11% or 112 employers) to three or more of the sub-criteria we found them not to have a formalized pharmacy benefits management process. Because the three primary criteria (procurement, continuous monitoring and evaluation) are not mutually exclusive to overall performance, an employer who did not address each process on its own merits was considered not to have a formalized process.

In summary, 936 out of the 1017 employers we polled did not have a formalized pharmacy benefits management process. This may come as a surprise to my readers but not to me. For me, it's just disappointing but why is it important? As I conclude this post I'm reminded of a quote from arguably the greatest business mind of our time.

"Ideas are worth nothing unless executed. They are just a multiplier. Execution is worth millions." 👉 Steve Jobs 

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