Under the Hood of Product Listing Agreements (PLAs):
the NIHB Program’s Automated PLA Invoicing
Andrew Portolesi M.Sc., Biostatistician
Non-Insured Health Benefits Program
First Nations & Inuit Health Branch
Indigenous Services Canada
CADTH Symposium
Apr 15-17, 2018
• I have no actual or potential conflict of interest in relation to this topic
or presentation.
Disclosure
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The Non-Insured Health Benefits (NIHB) Program is the Indigenous
Services Canada’s national, medically necessary health benefit program
that provides coverage for benefit claims for a specified range of drugs,
dental care, vision care, medical supplies and equipment, short-term crisis
intervention mental health counselling and medical transportation for
eligible First Nations and Inuit.
• NIHB provides benefit coverage to over 853,000 eligible clients
• Pharmacy expenditures in 2016/17 were $494M (out of $1.20B total
benefit expenditures)
NIHB is a member of the pan-Canadian Pharmaceutical Alliance (pCPA),
the national initiative for federal/provincial/territorial public drug plans to
collectively negotiate Product Listing Agreements (PLAs).
Overview of the NIHB Program
Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
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• A Product Listing Agreement (PLA) is a negotiated agreement between a
drug plan and a drug manufacturer for the plan to cover a specific drug at a
reduced price, usually through the use of a rebate
• PLAs allow drug plans to cover medications that otherwise would not be
considered cost-effective or affordable, and have become a de facto tool in
the management of public drug plans in Canada
• The result of a PLA negotiation by the pan-Canadian Pharmaceutical
Alliance (pCPA) is a confidential “Net Price” and possibly other risk-sharing
mechanisms such as Total Utilization Caps and/or Individual Patient Caps
• Once a PLA is signed and the drug listed on the plan’s Drug Benefit List,
rebate calculations must be performed on a regular basis in order for
invoices to be issued to the drug manufacturer
• This presentation describes the methodology of NIHB’s automated PLA
Invoicing System, created in SAS Enterprise Guide by NIHB and producing
invoice data for 100+ agreements in one business day every quarter
What are Product Listing Agreements (PLAs)?
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
• Since joining the pCPA in
2016, NIHB has seen a large
increase in the number of
PLAs enacted each year
• NIHB is also enacting a larger
proportion of non-standard
PLAs, with 60% of PLAs
enacted in FY2017/18 having
some additional complexity
• Some older PLAs have also
been amended to include
more complex discounts (not
shown)
Increasing PLA Volume & Complexity
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47
12
58
25
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1
2
2
6
5
1
1
5
1
3
6
1
4
5
0
5
10
15
20
25
30
35
40
45
# o
f A
gre
em
en
ts
NIHB PLAs Enacted per Fiscal Year (Apr-Mar)by Complexity at Listing, Apr 2011 – Mar 2018
High Complexity
Medium/High
Medium Complexity
Low/Medium
Low Complexity
Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
There are a number of differences between NIHB and provincial/territorial
drug plans that affect how our PLA invoicing is implemented:
• 100% coverage: No co-pays/deductibles/premiums
• National coverage, but pricing is province/territory-specific
• Reporting tool (Oracle Business Intelligence Enterprise Edition - OBIEE)
updated nightly, including reversed claims updated automatically to “PAID-
REVERSED” status within claims processor & reporting tool
• No medical data, except for approval reason codes for Limited-Use
requests (used in indication-specific PLAs)
• Use each provincial/territorial plans’ pricing as our pricing sources
(markups negotiated separately)
• Produce invoices five times a year (quarterly, plus twice in Jan-Mar due to
end-of-fiscal-year issues)
• SAS platform for advanced analytics, usually using SAS Enterprise Guide
Differences in NIHB program design from other plans
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
During PLA Drafting: Invoicing Feasibility/Complexity Review
• For every draft PLA (and draft Letter of Intent – LOI), provide a review of
feasibility/complexity as it pertains to invoicing:
– Keeps PLA invoicing team informed upcoming PLAs
– Allows proactive addressing of feasibility/complexity issues
Upon signing a PLA: Invoicing Implementation
• Implement rebate calculations in NIHB PLA Invoicing System (a SAS
Enterprise Guide project)
Quarterly: PLA Invoicing
• Generate invoice supporting data on a quarterly basis
– Systems team then populates PLA invoices and supporting data templates with
generated data
Ad Hoc Basis: PLA Invoicing Maintenance
• Update existing PLAs rebate calculations (e.g. amendments, price
changes)
• Respond to manufacturer inquiries on rebate amounts & invoice contents
NIHB PLA Invoicing Activities
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
NIHB PLA Invoicing System: Development History
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Date Functionality # of PLAs
May 2011 Individual Ad Hoc Reporting Tool queries (2 per drug) 2
Jun 2012 Multi-tab Ad Hoc Reporting Tool queries (1 per drug) 6
Dec 2013 Batch Ad Hoc Reporting Tool queries (2 queries for all drugs) 22
Jan 2015 PLA Invoicing SAS Enterprise Guide project 29
Dec 2015 Automated Total Utilization Caps (TUCs) 41
Jun 2016 Automated Individual Patient Caps (IPCs) 52
Nov 2017Migration of PLA claims data extract query to OBIEE (new Ad
Hoc Reporting Tool)104
Dec 2017Overhaul of Total Utilization Cap and Individual Patient Caps
methodology (“Metric” methodology)105
Jan 2018Automation of Average Utilization Caps (AUCs) and Distinct
Metric (Clients, Days, Months) methodology109
Mar 2018
Automated rebate adjustments (e.g. retroactive correction
amounts included in invoices & totals automatically instead of
manually)
117
Future Plans Outcome-Based PLAs
Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
• In Jan 2015, NIHB implemented its
PLA invoicing in its SAS platform
using SAS Enterprise Guide, a
visual point-and-click interface for
querying data, especially useful for
long sequences of SQL queries
• Large project: approximately 190
query nodes
• Full refresh in about 15 minutes
(most of which is the Claims Data
Import)
PLA Invoicing in SAS Enterprise Guide
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Discount
Factor &
Rebate
Calculations
Subtotals
Finance
Data
Tables
Invoice
Supporting
Data Tables
Individual Patient Caps
Total & Average
Utilization Caps
Special Modules
Supporting
Data
Imports
Claims
Data
Import
Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
1. At the start of each invoicing period, download previous invoicing period’s paid claims data NIHB
claims database using pre-defined, scheduled query in its Ad Hoc Reporting Tool (OBIEE)
2. Run the PLA Invoicing SAS Enterprise Guide Project, which automatically:
– Imports claims data and joins those data with PLA DIN Driver Table
– Computes complex calculations using running total data (e.g. Total Utilization Caps)
– Calculates Discount Factors and rebate amounts for each claim
– Aggregates rebate totals (only provincial/territorial-level utilization provided to manufacturers)
– Exports files of invoice supporting data tables, rebate totals, validation files and running totals
updates
3. Check validation files (e.g. discount factors)
4. Invoice production team produces invoices and populates invoice supporting data templates
(automated in Excel using INDEX and MATCH functions), sent to manufacturers
5. Report to management on invoicing results
NIHB PLA Invoicing Process
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PLA Claims
Data Extract
(from OBIEE)
PLA Driver
DIN Table
Applicable
PLA Claims
Discount Factor
Calculation
(by Claim)
Rebate
Calculation
(by Claim)
Aggregation
(Totals)
Running Totals
Data
Complex
Calculations
Updated
Running Totals
Export Invoice
Supporting
Data Tables
Export Finance
Files
Excel
SAS
Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
Export
Validation Files
PLA Claims Data Extract:
• Quarterly scheduled extract of all paid claims for every PLA drug (from Reporting Tool)
PLA DIN Driver Table: (DIN – Drug Identification Number)
• PLA Driver table of PLAs Names, DINs, Manufacturers and PLA Start Dates
• Group DINs together by PLAs (e.g for subtotals) and PLAs by Manufacturer
Discount Factor CASE statement:
• A CASE statement which assigns a Discount Factor to each claim
• Allows for discounts varying at a claim level, such as by province/territory or by date
• Can use both $ and % values, since all stored in as numbers
Rebate Calculations CASE statement:
• A CASE statement which chooses which rebate formula to use (default calculation is
Drug Benefit Cost x Discount Factor, rounded to nearest $0.01)
Variations:
Transparent PLAs (List Price = Net Price):
• Set Discount Factor to 0, which excludes claims from rebate calculation query
Indication-Specific PLAs:
• Extract Criteria Code data from request approval data
Standard (“First-Dollar”) Rebate Calculation Methodology
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
CASE
WHEN PLA = “DRUG 1” THEN 1 – 𝑁𝑃1 𝐿𝑃1WHEN PLA = “DRUG 2” THEN
CASE
WHEN Provider Province = “QC” THEN 1 – 𝑁𝑃2 𝐿𝑃2,𝑄𝐶
ELSE 1 – 𝑁𝑃2 𝐿𝑃2END
WHEN PLA = “DRUG 3” THEN
CASE
WHEN Service Date >= Apr 9, 2018 THEN 1 – 𝑁𝑃3 𝐿𝑃32ELSE 1 – 𝑁𝑃3 𝐿𝑃31
END
WHEN PLA = “DRUG 4” THEN 0
END
Discount Factor CASE Statement Example (4 PLAs)
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
Claim ID DIN [Other fields]
C1 DIN 1 …
C2 DIN 1 …
C3 DIN 1 …
C4 DIN 2 Province: ON
C5 DIN 2 Province: QC
C6 DIN 3 Date: Apr 3, 2019
C7 DIN 3 Date: Apr 15, 2019
C8 DIN 4-1 …
C9 DIN 4-2 …
Discount Factor Example, Claim-Level Results
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Company PLA
MFR 1 DRUG 1
MFR 1 DRUG 1
MFR 1 DRUG 1
MFR 2 DRUG 2
MFR 2 DRUG 2
MFR 2 DRUG 3
MFR 2 DRUG 3
MFR 2 DRUG 4
MFR 2 DRUG 4
Discount
Factor (DF)
Rebate
1 – 𝑁𝑃1 𝐿𝑃1 𝐶𝑜𝑠𝑡 × 𝐷𝐹
1 – 𝑁𝑃1 𝐿𝑃1 𝐶𝑜𝑠𝑡 × 𝐷𝐹
1 – 𝑁𝑃1 𝐿𝑃1 𝐶𝑜𝑠𝑡 × 𝐷𝐹
1 – 𝑁𝑃2 𝐿𝑃2 𝐶𝑜𝑠𝑡 × 𝐷𝐹
1 – 𝑁𝑃2 𝐿𝑃2𝑄𝐶 𝐶𝑜𝑠𝑡 × 𝐷𝐹
1 – 𝑁𝑃3 𝐿𝑃31 𝐶𝑜𝑠𝑡 × 𝐷𝐹
1 – 𝑁𝑃3 𝐿𝑃32 𝐶𝑜𝑠𝑡 × 𝐷𝐹
0 N/A
0 N/A
Imported from
PLA DIN Driver Table
(Excel) & joined to
claims data by DIN
Imported from
PLA Claims Data
Extract (from NIHB
OBIEE reporting tool)
Calculated in SAS
(“Cost” = Drug Benefit Cost
i.e. excluding professional
fees and after Coordination
of Benefits)
Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
For Total Utilization Caps (TUCs), Individual Patient Caps (IPCs) and Average
Patient Caps (AUCs):
Metric methodology:
• Assign each capped PLA a metric type (e.g. “Quantity”, “Drug Benefit Cost”,
“Dose Conversion”, etc.), which tells SAS what to measure in a single column
that is compared against each agreement’s cap(s)
Running Totals:
• Keep a file of running totals for each metric agreement year of each PLA that
the new quarter’s metric can be added to
Discount Tiers:
• Separating claims before/after caps into different utilization tables, with different
Discount Factors (100% for hard caps)
• Also separates utilization from different agreement years when the cap reset
date is during a quarter
Discount Tier Proportions:
• Calculating what proportion of a claim belongs in each Discount Tier, splitting
the claim as required into different Discount Tiers
Utilization Cap Methodology
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
Discount Tier Proportion Example
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Individual Patient Cap of $1,000 on DRUG 1 (from previous example)
Previous running totals (from this year) for client: $850
This quarter: 3 claims for $100 each
Claim Metric Tier A (before cap) Tier B (after cap)
C1 $100 100% 0%
C2 $100 50% 50%
C3 $100 0% 100%
Claim ID DIN
C1 DIN 1
C2 DIN 1
C2 DIN 1
C3 DIN 1
Company PLA
COMP 1 DRUG 1
COMP 1 DRUG 1
COMP 1 DRUG 1
COMP 1 DRUG 1
Discount
Factor (DF)
Rebate
1 – 𝑁𝑃1 𝐿𝑃1𝐴 𝑃𝑟𝑜𝑝 × 𝐶𝑜𝑠𝑡 × 𝐷𝐹
𝟏 – 𝑵𝑷𝟏 𝑳𝑷𝟏𝑨 𝑃𝑟𝑜𝑝 × 𝐶𝑜𝑠𝑡 × 𝐷𝐹
𝟏 – 𝑵𝑷𝟏 𝑳𝑷𝟏𝑩 𝑃𝑟𝑜𝑝 × 𝐶𝑜𝑠𝑡 × 𝐷𝐹
1 – 𝑁𝑃1 𝐿𝑃1𝐵 𝑃𝑟𝑜𝑝 × 𝐶𝑜𝑠𝑡 × 𝐷𝐹
Discount
Tier
Proportion
(Prop.)
A 100%
A 50%
B 50%
B 100%
Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
Variations:
Total Utilization Caps (TUC)
• Proportions calculated based on all claims so far that Agreement Year
for that PLA and applied to all corresponding claims
Individual Patient Caps (IPC)
• Time frames can be specific to individual clients, i.e. “Treatment Years”
defined by date of client’s first claim
Average Utilization Caps (AUC)
• Ratio of two metrics, usually only calculated in the last quarter of an
agreement year (too many exceptional cases to calculate and true-up
on each invoice)
– Additional exception in case annual utilization exceeding the average cap is
more than the utilization on the current invoice
Utilization Cap Methodology (cont.)
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
A number of files are reviewed to validate the PLA invoicing results:
• List of all Discount Factors calculated by SAS for each PLA
– Compared against an Excel spreadsheet of all Discount Factors for each PLA
• List of claims invoiced against more than once in the same PLA
– Only acceptable when using Proportion/Discount Tier methodology, total
proportion cannot exceed 1
• Summary tables of cap calculations
– Check calculations of Proportions and Discount Tiers
• Invoice Supporting Data Tables (main outputs)
– Check that all new/amended/updated PLAs are included in outputs, with
rebates calculated correctly
Validation of PLA Invoicing
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
1. Push-button: No manual programming required on invoicing day (all
implementation is done beforehand)
2. Proactive: turnaround time on implementing new PLAs is usually fast
since already reviewed draft LOI/PLAs
3. Fast results: SAS project runs in around 15 minutes (not including PLA
Claims Data Extract query, scheduled to run in early morning)
4. No arrears: Invoices are designed to change to correct discount
immediately once a cap is reached
5. Uniformity of outputs: Easier for systems team to populate supporting
data excel files
6. Replicable: Can re-run the SAS project to produce all results
7. Expandable: New PLAs easily added by adding the DINs to the PLA DIN
Driver table and the PLA Claims Data Extract query, and adding the
Discount Factor to the CASE statement in SAS plus any other parameters
for utilization caps
Attributes of NIHB’s PLA Invoicing System
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
A new type of PLA being considered by the pCPA is Outcome-Based PLAs
(OBAs), which will use external outcome data to determine the rebate amount
(i.e. Discount Factor personalized to each client)
• For invoicing patient-level Outcome-Based PLAs, NIHB is considering a
“Parking Lot” methodology:
– Claims invoiced against first-dollar discounts, then held in “Parking Lot” table
until notified of the outcome for that client
– When outcomes data are received, additional rebates are applied to claims in
“parking lot” as external data dictates
– What form these data will take and how they will be handled remains to be
determined
• Outcome Based PLAs using population-level outcomes not as complicated
Future Plans: Outcome-Based PLA Methodology
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
• NIHB has developed a robust, automated system for producing its
quarterly PLA invoices, resulting in all PLA invoicing data being generated
within 1 business day
• Early engagement of invoicing team during PLA development has been
critical in ensuring feasibility of implementation
• Uniformity in future PLAs is important to maintain feasibility of producing
invoices for all PLAs, especially as the number and complexity of PLAs
continues to increase
• Important to consider PLA Invoicing as a database problem on claim-level
data instead of an Excel problem on aggregate data
Conclusion
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing
Questions?
Andrew Portolesi M. Sc.
Biostatistician
Non-Insured Health Benefits Program
First Nations & Inuit Health Branch
Indigenous Services Canada
Thank You!
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Under the Hood of Product Listing Agreements (PLAs): NIHB’s Automated PLA Invoicing