Twelve PBM Contracting Pitfalls and Ways to Avoid Them PBM Contracting Pitfalls ... and Ways to Avoid Them ... Twelve PBM Contracting Pitfallsand Ways to Avoid Them ... Common Contracting

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  • Atlantic Information Services, Inc.1100 17th Street, NW, Suite 300 Washington, DC 20036 202-775-9008 www.AISHealth.com

    Twelve PBM Contracting Pitfalls ... and Ways to Avoid Them

    Josh Golden, Senior Vice President Solid Benefit Guidance

    Helen Sherman, Pharm.D., R.Ph., Vice President Solid Benefit Guidance

    Thursday, June 30, 2016

    Click here to begin the On-Demand recording of this Webinar

    C6P16

    https://aishealth.com/node/c6p16_48771

  • About the SpeakersJOSH GOLDEN is an area senior vice president at Solid Benefit Guidance (a division of Arthur J. Gallagher), where he is responsible for the successful delivery of a wide range of pharmacy consulting solutions to Fortune 500 employers, government entities, labor unions, and other benefit plan sponsors. He has over 17 years of experience as a strategic consultant within the health care industry, and brings to bear a keen understanding of the entire pharmacy benefits supply chain to help his clients optimize financial and health care outcomes for the populations that they cover. Josh is recognized as a thought leader in the pharmacy benefits arena, and is frequently called upon for speaking engagements and media inquiries at a national level. He has extensive expertise in the areas of vendor procurement, contract negotiation, benchmarking, audit and plan design consultation. Before joining Solid Benefit Guidance in 2016, Josh was the practice leader of the Employer Consulting Segment of Pharmaceutical Strategies Group, LLC. Prior to that role, Josh served as a senior pharmacy consultant with Aon Hewitt. He has also served as a pharmacy specialist consultant with Mercer Human Resource Consulting and a benefits analyst with Buck Consultants. His clients have included some of the largest and most complex employers in the country. Josh has a Bachelor of Science degree in Industrial and Labor Relations from Cornell University. Contact Josh at josh_golden@ajg.com.

    HELEN SHERMAN, Pharm.D., R.Ph., is vice president at Solid Benefit Guidance, where her lifelong commitment to advancing the best use of medications supports payers, consumers and health care professionals with informed, value-based decisions. She is an advocate of health care transparency and value and focuses on using solid scientific evidence as a foundation for health care decisions. She is dedicated to helping clients develop effective solutions in a dynamic and evolving health care marketplace. Helen has comprehensive leadership expertise in pharmacy benefit management, including business development, market evaluation, clinical services, rebate management, sales, account management, operations, claims processing, customer service, Medicare Part D, Medicaid, regulatory requirements and vendor/system transitions. Helen spent 15 years in the health plan/pharmacy benefit industry, including as vice president for business development and chief pharmacy officer for RegenceRx (a health plan-owned PBM), where her leadership supported medication-purchasing decisions for 10 million members nationwide with an annual drug spend of $1 billion. She is an internationally recognized speaker and sits on several industry boards, including the advisory board of Drug Benefit News. Helen graduated from Oregon State University with a Bachelor of Science degree in Pharmacy and has a Pharm.D degree from Purdue University. Contact Helen at helen_sherman@ajg.com.

    Moderator: Lauren Flynn Kelly, managing editor at AIS

    Three Ways to Submit Your Questions for the 30-Minute Q&A Session

    Presentations should run approximately 60 minutes, with 30 minutes of questions and answers. Questions may be submitted in three different ways:

    Prior to the Webinar

    (1) Email your question(s) to Lauren Flynn Kelly at lkelly@aishealth.com. or

    During the Webinar

    (2) To send a question from the Webinar page, go to the Chat Pod located in the lower left corner of your screen. Type your question into the dialog box at the bottom and then click on the blue send button or

    (3) Dial *1 on your phone keypad and an operator will connect you to the moderator so that you can ask your question(s) live with the Webinar participants listening

  • About the Sponsor Atlantic Information Services, Inc.Atlantic Information Services, Inc. (AIS) is a publishing and information company that has been serving the health care industry for nearly 30 years. It develops highly targeted news, data and strategic information for managers in hospitals and health systems, health insurance companies, medical group practices, purchasers of health insurance, pharmaceutical companies and other health care organizations. AIS products include print and electronic newsletters, databases, websites, looseleafs, strategic reports, directories, webinars and virtual conferences.

    AIS publishes several highly practical publications that address drug pricing and value-based Rx purchasing, including:

    DRUG BENEFIT NEWS is a hard-hitting newsletter for health plans, PBMs, pharma companies and employers. Published biweekly, it delivers both timely news stories and in-depth accounts of cost management strategies that are being employed by drug purchasers. Coverage includes news of performance-based pricing, the emerging biosimilars market, pricey drug launches, soaring specialty costs, insurer and PBM consolidation, generic inflation, exclusionary formularies, narrow pharmacy networks and more.

    HEALTH PLAN WEEK is the nations #1 source of timely, objective business, financial and regulatory news of the health insurance industry. Published since 1991, the 8-page weekly features valuable insights and strategies for health plan managers and others who must monitor the activities and performance of health insurers. Coverage includes new benefit designs and underwriting practices, new products and marketing strategies, mergers and alliances, financial performance and results, Medicare and Medicaid opportunities, disease management, and the flood of reform-driven regulatory initiatives including medical loss ratios, exchanges, ACOs and myriad benefit design changes that are mandated.

    SPECIALTY PHARMACY NEWS is a monthly newsletter packed with 12 pages of business news and management strategies for containing costs and improving outcomes related to high-cost specialty products. Designed for health plans, specialty pharmacies, pharma companies, providers and employers, the hard-hitting newsletter contains valuable insights into benefit design tactics, the emerging biosimilars market, specialty markets for certain conditions, formulary decisions, merger and acquisition activity, payer-provider partnerships, patient adherence strategies, and new products.

    Learn more about all of AISs products and services at the Marketplace at www.AISHealth.com

    This publication is designed to provide accurate, comprehensive and authoritative information on the subject matter covered. However, the opinions contained in this publication are those solely of the speakers and not the publisher. The publisher does not warrant that information contained herein is complete or accurate. The conference materials are published with the understanding that the publisher is not engaged in rendering legal or other professional services. If legal advice or other expert assistance is required, the services of a competent professional person should be sought.

    Copyright 2016 by Atlantic Information Services, Inc. All rights reserved.

    Organizations participating in the June 30, 2016, Webinar are hereby permitted to make one photocopy of these materials for each of their employees or contractors who listen to the live broadcast of the Webinar.

  • Webinar MaterialsTwelve PBM Contracting Pitfallsand Ways to Avoid Them..........page 1

    Josh Golden, Area Senior Vice President, and Helen Sherman, Pharm.D., R.Ph., Vice President, Solid Benefit Guidance

    Selected Articles From AIS Publications..page 18

    Webinar OutlinePart 1: Josh Golden and Helen Sherman, Solid Benefit Guidance

    Overview of PBM Contracting and Revenue Model

    Vague Brand/Generic Definitions

    Guarantee Offsets

    Rebate Loopholes

    Price Modification Rights

    Nuances of Transparency

    Limited Termination Rights

    Market Check Provisions

    Audit Right Considerations

    Hidden Fees & Charges

    ZBD Priding Exclusions

    Specialty Drug Nuances

    Weak Service Performance Guarantees

    Part 2: Questions and Answers

  • April 2015

    Twelve PBM Contracting Pitfalls And Ways to Avoid Them

    The information contained herein is compiled by Solid Benefit Guidance from a variety of sources, and is provided for educational purposes only. This information is not to be distributed further without the permission of Solid Benefit Guidance.

    Presented by: Josh Golden Helen Sherman, PharmD. josh_golden@ajg.com helen_sherman@ajg.com 404-862-3605 201-571-3840 Solid Benefit Guidance Solid Benefit Guidance

    June 30, 2016 An AIS Webinar

    1

  • PBM Underwriting & Contracting

    The PBM (Pharmacy Benefit Management) bidding and pricing process is extremely complex, and often opaque.

    Like any high volume business, the fine print is where the money is made.

    Subtle manipulation of definitions can have significant downstream financial impact.

    There is constant movement within the industry, allowing vendors to manipulate margin over time.

    Specialty pricing is playing an increasingly important role in total cost outcomes.

    Business Transparency is used (and misused) widely in the industry, with mixed success.

    There tends to be a lack of pull through negotiated items do not always end up in the contract draft.