February 9, 2010 - The Federal Trade Commission is investigating allegations of improper business practices by a firm that provides prescription drug services for health insurance companies that cover most federal employees. FTC probing CVS Caremark's Prescription Drug Practices — Washington Post
February 21, 2010 - The CEO of WellPoint, Inc, the nation's largest health insurer, is being called before Congress this week to defend planned rate hikes of as much as 39 percent for some customers even as the company made billions last year. It appears as if its pharmaceutical costs are up 13% and last year they received $2.2 billion on the sale of their PBM subsidiary. Diving Into WellPoint's Health Insurance Profits — Associated Press
March 8, 2010 - A bill that would require greater PBM transparency within the Federal Employees Health Benefits Program received some criticism during a recent hearing from the Office of Personnel Management, which says it just directed health plans to improve PBM contracting practices in order to control the program's swelling drug costs....Visit http://www.aishealth.com/GNOW/030810.html#gnowthree for more information.
Why Should You Consider an Audit of Your Pharmacy Benefit Manager (PBM)?
The Pharmacy Benefit Management (PBM) industry is complex and there is not a viable means to let them know how they are performing, except by performing an audit. For many years, plan sponsors would depend on their PBM to let them know how they were performing! An audit of PBM contracts is essential in order to know if you are making the best drug benefit decisions for your employees. How can you have confidence that your company is receiving the agreed upon value and service by your PBM?
 The PBM industry is currently operated by three large national players; however, there are some smaller and regional PBM's too. PBM's have been very reluctant to volunteer real transparency as it relates to their pricing guarantees and rebates. They may cite trade secrets and confidentiality disclosure concerns as their rationale.
Some standard PBM contracts are now granting the plan the ability to co-approve their auditors, and limiting the amount of information that they can review. Others are limiting the recovery of funds due the plan sponsor.
Plan sponsors not only have a right, but an ERISA and Taft Hartley obligation on the part of their plan and its members, to validate and verify their vendor's performance.
Do you want to spend your health care dollars
on errors made by your PBM?
Perform an annual audit of your PBM vendor to:
- Review all auditable contract terms and benefit designs to determine if the clients either overpaid or did not receive the services as stated in their contracts.
- Identify areas of both recoveries and future savings. Many PBMs make the majority of their profits on business practices that are hidden from their clients.
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