A little more than a year ago, a network of pharmacists banded together to work to reform the industry of pharmacy benefits management, which has become rife with abuse and a lack of transparency over the past decade. Pharmacy benefits managers are third-party administrators of prescription drug programs that contract with employers, insurers and pharmacies to manage prescription drug coverage for pharmacy patients.
Increasingly, both private and public sector groups are beginning to take a careful look at the practices of pharmacy benefits managers as employers and taxpayers become curious about massive PBM profits and unclear contracts.
Last week, the Taxpayers Protection Alliance, a non-profit organization focused on government waste, released a new report focused on the PBM industry's increasing use of mandatory mail-order prescription drug programs. The full report, The Expensive Truth Behind Taxpayer-Funded Mail Order Pharmaceuticals, is available here.
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Among the findings in the study, a survey of community pharmacists across the country found:
- 89 percent of pharmacists said that patients moving to mail order did so because of encouragement or a mandate from either an employer or PBM.
- 98 percent of pharmacists said that their former patients did not seem satisfied with mail order.
- 98 percent of pharmacists believe that mail order creates more waste in the health care system.
The report is further substantiation of a reality community pharmacists have understood for years: Mail order programs eliminate patient choice, undermine the pharmacist/patient relationship, and contribute to wasteful spending with auto-refill programs and unresponsive customer care.
The PBM business model relies heavily on confusing contracts and financial transactions. Those contracts plus the lack of regulation and transparency that have become common in the PBM industry put employers, consumers and taxpayers on the hook.
Recently, Pharmacists United for Truth and Transparency (my organization) released a comprehensive tool to educate employers and help them negotiate contracts. Read an executive summary here.
For benefits managers, it's important to take a careful look at the mail order terms identified in contracts with your PBM and check with employees to see if they are satisfied with mail order service. As the public sector investigates whether mail order is indeed costing tax payers extra money, private employers should be pushing PBMs for the proof of savings they claim to provide.
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