Transparent business models for administering the pharmacy benefit have become increasingly attractive to payers and, as a result, to vendors. Demands for transparency have opened up the PBM market to new vendors and business models, tightened competition in the industry and changed the contracting process.

PBM Contracting and Transparency Issues and Models examines which contracting strategies have been successful, and which have failed or have contributed to confusion among pharmacy benefit clients. It shares real-life experiences that companies including Medco, Express Scripts and Prime Therapeutics have had with rebates and other models.

This valuable report details the decisions that factored into many contract negotiations, both in the public and private sectors — factors such as cost, state and federal legislation, and the unique concerns of specialty pharmacy providers — and pays particular attention to the role of transparency in these negotiations.

Order your copy of PBM Contracting and Transparency Issues and Models today, and learn from the practices of leaders in the pharmacy benefit industry.

Table of Contents

Chapter 1: Contracting Models and Revenue Sources

• PBA Model Offers Transparency, Control to States and Employers
• MCOs With Local Market Share, Control, Bring Rebates In-House
• Selected MCOs With In-House Rx Rebate Management, December 2003
• Pittsburgh Employers’ Deal With PharmaCare Shows Advantages of Group Contracting
• MCO Direct Contracting With Drug Firms Has Potential to Net Gains
• Medco Shares Rebate-Contracting Strategy for Part D Benefit
• Transparency Demands Spawn New Firms, Shake Up Traditional PBMs’ Strategies
• Study Measures PBM Revenue Source, Prompts Ongoing Debate
• Features of PBM Contracts — Transparent and Otherwise
• Transparency Requests Lead to Creative, Confusing Contracts
• Next-Generation Relationships Between Payers and PBMs
• Examples of PBM Contracted Discounts and Resulting Spread
• One PBM Warns of ‘Spread’ While PCMA Fights States on Disclosure
• Illinois Mail-Order Flap Highlights PBM Contracting, Transparency Controversies
• Web-Based Rebate Management Tool to Improve Contracting Process
• Opaque PBM Contracting Raises Red Flags; Plans Must Ask Basic Questions, Feds Say
• PBMs, Health Plans Eye ‘Access Rebates’ Over Other Rx Rebate Methods, Survey Finds

Chapter 2: Transparency Strategies and Challenges

• Premera Sees ‘Transparency’ as Being More Than Rebates, Discounts
• Ventegra Launches as PBA-GPO Hybrid Pharmacy Benefit Service
• PBM Transparency Deal May Lower Rx Drug Spending, but Won’t Shake Up the Industry
• More PBM Transparency May Not Cut Costs, but Could Boost Trust

Chapter 3: Transparency in Contract Negotiations

• Two Large Employer Coalitions Insist on Full Transparency in PBM Arrangements
• HCSC Chooses Prime Therapeutics’ Unique Business Model, Says Transparency Is Key
• HealthExtras Wins Louisiana Pact, Cashes In on Transparent Model
• Clients’ Transparency Demands Spawn New Firms, Shake Up Other PBMs’ Strategies
• Transparency Is Key, but Not Only, Factor in Ohio Coalition’s PBM Contract Award
• Savannah Business Group Starts Offering Transparent PBM Model From Envision
• Employer Coalition Picks PharmaCare as ‘Preferred PBM’ in Fully Transparent Deal
• Medco Wins Four-Year NC State Employees Fee-Based Contract on Service, Disclosure
• Express Scripts, Walgreens Protest Illinois PBM Pact Awarded to Medco
• PBM Contracts Won on Basis of Transparency, as of February 2005
• Experts Offer Advice to Payers on Comparing Transparent PBM Bids
• CalPERS Follows Payers’ Lead as It Seeks an ‘Unprecedented Degree’ of Transparency
• Three PBMs Picked to Offer Transparency to Employer Coalition

Chapter 4: Rebate Negotiations

• MCOs With Local Market Share, Control, Bring Rebates In-House
• Hawaii Health Plan in Rehabilitation Opts to Stop Participating in Drug Rebates
• Employer Coalition Seeks to Circumvent PBMs, Directly Contract for Drug Rebates
• Hewitt Exec Explains Why Coalition’s Direct-Contract Plan Failed

Chapter 5: Public Sector Contract Awards

• Caremark Rakes in Big Public-Sector Pacts Replacing Other PBMs in Texas, Chicago
• FEHBP Vendor Switch Has Implications for All PBMs, Not Just Medco and Caremark
• South Carolina Flip Flops on PBM Contract; Medco Wins One-Year $300 Million Deal
• Envision Beats Out Three Contenders to Serve 1.7 Million Under Ohio’s Best Rx
• Medco Wins RFP to Serve Texas Employees Drug Plan, Despite Contract Disclosure Suit
• Medco Wins Two State Bids Away From Express Scripts, One Mainly on Transparency
• Medco Poised to Regain CalPERS Contract; ‘Transparent’ RFP Drew Multiple Bidders
• Medco’s ‘Strides’ in Business Practices Propel HealthNow, CalPERS Contract Wins
• Maryland Awards Catalyst Rx Contract, Passes on PBM Curbs
• Minnesota to Consolidate Pharmacy Benefit, Taps Navitus as Sole PBM for State Workers

Chapter 6: Federal and State Initiatives

• Feds Promote Competition Among PBMs, Not Further Regulation
• Court of Appeals Uphold Maine Unfair Prescription Drug Practices Act
• Medicare Rx Drug Pricing Needs Transparency, Experts Tell House
• Texas, Iowa Pass Bills Regulating PBMs; N.Y. Considers Legislation

Chapter 7: Specialty Pharmacy Contracting

• Survey Spots MCOs’ Contracting Goals for Specialty Pharmacy
• Smart Contracting Helps Manage Specialty Pharmacy Programs
• UHC Finds ‘Less Is More’ With Specialty Pharmacy Contracting

Written For

• Managers of HMOs, PPOs, and other managed care companies
• Purchasers, employers, and Pharmacy Benefit Management companies
• Managers in the pharmaceutical industry
• Health plans and medical groups
• Unions
• Insurance payers
• Network contractors

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