Expert pharmacy benefit management (PBM)
consulting team
In-house pharmacists, PBM and Medicare Part D experts Former C-level PBM executives averaging 20+ years
industry experience each
Manage 18 million+ pharmacy lives
Provide unbiased, impartial, expert advice Recommend solutions rather than products Acquired by Lockton in 2012
Specialize in working with self-funded employers, health plans, TPAs and other
payers to:
Optimize PBM arrangements
Leverage improved vendor relationships
Identify additional opportunities for cost savings Develop strategies in a dynamic marketplace
Provide full disclosure on all compensation
Excelsior Pharmacy Analytics
Independent annual auditing of contractual guarantees
Based on all information affecting employer cost (discounts, dispensing fees, rebates, admin fees, brand vs. generic classification, formulary lists, drug mix
management) Employers receive
penalty check if guarantees were not met
Ensure members are not being overcharged
INDEPENDENT AUDITS
Objective approach with transparency and no carrier/PBM-specific incentives Rigorous financial valuation of all proposals Clinical program evaluation Winning PBM must submit to certain contract provisions, guarantees, and annual independent audits PBM MARKETING AND RENEWALS CONTRACT REVIEWS Establish clear contractual definitions Structure dollar-for-dollar performance guarantees
Secure objective audit procedures
Define clear algorithms for guarantee and penalty calculations
Pricing benchmarks Disease analysis
Drug mix analysis and interchange opportunities Contract review Project employer savings if PBMs were shopped today Brand vs. generic classification Narcotic abuse DIAGNOSTIC STUDIES
Full Service Pharmacy Consulting
Creating Better Economics Full Market Evaluation
Assess current contract > Renegotiate – Moving into years 4 and 5 with Premera RFP that includes top PBM’s > Leverage health plan pricing
Transparent contract > Insure terms and conditions drive most favorable results for client Allow collectives to participate
Trend Management
RX Mart: Data Analytics
Excelsior’s proprietary data solution Holds PBM accountable to contract Provides in depth utilization review
Drill down capabilities for each client's specific needs
Clinical Oversight
Pharmacist review of data to determine most effective PBM programs, i.e. Step Therapy, QL, PA Narrow network evaluation
Specialty Rx consulting
Execution
Ongoing Account Management
Implementation oversight Quarterly review meetings
RxMart Reporting – Holding your PBM accountable
How is your
PBM performing?
Pharmacy Analytics
YOUR MOST HIGHLY UTILIZED HEALTHCARE BENEFIT:
PRESCRIPTION DRUGS
BILLIONS
Are Wasted on drug choices
Contract
Reviews Diagnostic Studies Procurement PBM and Renewals
Independent
Pricing Audits Drug StrategySpecialty
Detailed Claims Analysis Formulary Management Financial Guarantees Specialty-Drug Management
Contract Optimization Medication Adherence Improvement Plan Design Strategies Network and Channel Optimization
1% of members = 25–30% of
pharmacy spend
The Financial Significance of Specialty Pharmacy
53% of specialty paid under medical benefit,
managing cost requires site of care strategies
69%
43%
35%
13%
Medical Specialty Costs Other Hospital Outpatient Physician Office Home Health
Hemophilia patient’s annual cost: $850K; effective patient care saves 62% of overall care cost5 Biosimilar appropriateness; 26% savings on $11B drug category4
Ensuring adherence monitoring, $200B annual US cost from drug misuse2
Lab verification; 1 Rx to 1 of the only 96% of Cystic Fibrosis patients not qualified for drug costs
$300,000/yr3
Why Integrate the Specialty Medical and Pharmacy Strategies?
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Percentage of Membership Affecting Drug Spend Specialty Traditional 99% Percentage of Drug Spend 70% 30% 1%
What It Is:
Analyzes a client’s potential financial exposure to key specialty/high cost drug
categories
Targets key drugs in the pipeline, recently released drugs, specialty drugs, high
cost diseases, and expanded indications for existing therapies
The tool was developed with FDA guidelines and is piloted with the following
disease states: Hepatitis C
High cholesterol PCSK9 Multiple Sclerosis
Cystic Fibrosis
Idiopathic Pulmonary Fibrosis
Uses medical and Rx data from InfoLock along with population disease rates Model will continue to be refined with new drugs, disease states, & clinical data Model shows minimum costs not inclusive of physician drug administration fees
What It Is Not:
Predictive tool for a client’s TOTAL specialty spend
Potential Additional 2016 Rx Costs
Paid Claims Idiopathic Pulmonary Fibrosis (narrow definition):Individuals with one or more paid claims
in the reporting period with ICD 9
code 516.3. PCSK9 Inhibitors: Unique Members with Elevated LDL-C despite being on statins or can't tolerate. Hepatitis C: Individuals
with one or more paid claims in the reporting period with ICD 9 codes 070.41, 070.44, 070.51,
070.54, 070.70 or 070.71.
Multiple Sclerosis:
Individuals with one or more paid claims in the reporting period with ICD 9
code 340.
Cystic Fibrosis:
Individuals with paid claims for one inpatient visit or two outpatient visits with a diagnosis of Cystic Fibrosis. Number below is 28% of CF patients, minus those taking Kalydeco Total Potential Members 1 202 24 28 1 8543 Treatment $96,000 $12,000 $85,000 $40,000 $300,000 Percent in 2016 50% 15% 20% 15% 100% Budget Impact $48,000 $363,600 $408,000 $168,000 $300,000 $1,239,600 PMPY $6 $43 $48 $20 $35 $145 New Drug Introductions Esbriet or Ofev, both approved 10/2014 Praluent (alirocumab) - 7/24/2015, Reptha (evolocumab) - 8/27/2015 Includes Sovaldi, Harvoni, Viekira Pak &
drugs that must be taken with them
Zinbryta
(daclizumab) 6/2015 Orkambi - 7/5/2015
Savings Insight
Based upon the limited data
available in the claims experience, it
creates a challenge to provide a full
assessment of the savings affiliated
with the current arrangement
To project the estimated savings
we’ve leveraged the average per
script savings achieved over
Lockton’s book of business in 2014
Total annualized savings
opportunity: $200,000 to $350,000
Renogiate AWP discounts, Rebates,Dispensing Fees
Implement best-in-class contract language Quarterly Audit provision with full
reconciliation annually
Potential Annualized
savings: $200k - $350k
Lockton Pharmacy Analytics
Specialty Drug
Spend Mitigation PBM Marketing
Clinical Savings Analysis Prospective Cost Modeling Formulary Management Contract Optimization Member Cost Share Strategies Detailed Claims Analysis
Lockton’s Pharmacy Analytics practice supports plan sponsors in assessing the current and future cost drivers of their pharmacy benefit plan and deploying strategies to enhance value and mitigate spending. Our experienced consultants will provide plan sponsors guidance on how to address immediate needs and opportunities while also positioning the plan to successfully manage future challenges.
