Data Collection

At the outset of each client project, to aid our clients in the efficient gathering of necessary data, documents, claims histories and related items, we present the client with a data template.  The template details precisely what we will need in order to carry out our assignment, and allows our client to eliminate wasted effort gathering materials and documents that are non-essential to the task at hand. 

This information usually includes, but is not limited to, detailed plan documentation, plan descriptions, employee communications, employee contributions, claim history reports, enrollment history, rating information and other information specific to the engagement.  Because we have extensive experience in evaluating such data, the template we provide is highly specific and aids in gathering precisely what we need. 

And, if our client needs assistance in completing the template, our consultants are always available to help them in the process.

Plan Design and Clinical Programs

GPS uses client-provided data to assess the plan’s overall circumstances.  Characteristics and features of current the plan design and clinical programs are thoroughly examined and potential areas of improvement are identified.  As needed, forecasts are made of the likely financial impact of specific plan design and clinical program modifications.  Our analysis of clinical programs helps us determine if these complement the plan sponsor’s goals.  We often find that existing clinical programs are not ideal, either because they are strongly resisted by plan members or because they do not encourage or support economical usage of plan resources.

GPS performs financial modeling of actual historical claim data and variance analyses to develop recommended plan design options.  This process is very precise, and is normally based on one to two years of our client’s historical claim data to use as the baseline.  We work directly work with the client’s PBM to obtain claims data to use as the basis of our benefit analyses, cost forecasts and benefit design modeling.  In those instances where we are not able to obtain this data, we employ our proprietary prescription drug manual rating tool that can be used to provide relative rate analyses by modeling changes to any plan design feature.  We also possess industry normative data that can be used to supplement this type of analysis.

Funding Arrangements

GPS will perform an operational assessment to review all current plan administrative features and funding arrangements to determine whether our client’s best interests are being served in light of the plan sponsor’s risk tolerance.  We believe it is prudent for plan sponsors to consider any and all available alternatives to self-funding of their pharmacy plan.  While self-funding ultimately might be the best approach, this should not be assumed in advance.  An understanding of alternative arrangements is, in our view, essential to informed financial and risk management planning.

GPS has extensive knowledge of the partial and full insurance arrangements that are available in the marketplace for pharmacy plan sponsors of all sizes.  Although not commonly known to most plan sponsors, reputable insurers with strong industry ratings for management and solvency offer a variety of indemnification approaches for pharmacy plan sponsors.

These approaches range from aggregate reinsurance to full insurance.  Some insurers offer full insurance for Generic Only programs.  Risk assumption is also available for Specialty Pharmacy.  Many other options are available.

GPS leaders are well versed in all phases of underwriting, risk assumption, and the advantages and disadvantages of self-funding versus partial or full indemnity.  Our experience in this area can definitely help inform our clients’ decisions.

Assessment of Formulary, MAC, and Network

In addition to plan design, clinical programs and funding arrangements, GPS performs a formulary assessment, a maximum allowable cost (MAC) assessment, and a network analysis.

The formulary assessment will help determine if the products on the list are successfully maximizing plan financial performance without compromising patient care. 

A Maximum Allowable Cost (MAC) List is a list of prescriptions available generically with fixed prices. The MAC price is the unit price that has been established for a drug on the MAC list. A drug is normally placed on a MAC list when three or more generic distributors produce the same drug. MAC prices were created because the Average Wholesale Price (AWP) and cost of identical generic drugs may differ significantly from distributor to distributor.

GPS consultants have extensive experience in evaluating MAC lists and recommending changes that can improve plan financial performance.

GPS helps to assure that its clients’ plans utilize optimal networks. This can include not only an analysis or comparison of how large a network is (and what pharmacies are included) but also an assessment of its accessibility, pricing, and to what extent certain plan sponsor-specified requirements are met.  Such requirements could include:

·   Professional liability and malpractice insurance.

·   Real-time information system linkages for determination of member eligibility, benefits, claims history, messaging and clinical information.

·   Willingness to offer a contract for network inclusion to a retail pharmacy not already included in the network, within two (2) business days following the Plan’s date of request.

·   Contracts that do not prohibit the use by the Plan and distribution to its members of independently developed pharmacy performance evaluations.

·   Willingness to provide a customized network with existing contracted pharmacies without re-contracting.

·   Specialty Pharmacy Services can be provided as part of the provider network arrangement. 

·   Exclusive arrangements for specialty pharmacy services are not required.

·   Accessibility of credentialing, monitoring and re-credentialing processes.

·   Appropriate processes for audits of participating pharmacies.

·   Contract records will be retained for a certain period of time, for the purpose of auditing.

The results of these processes will further influence our ultimate recommendations for improved plan performance.  Where appropriate, we recommend additions and deletions.

Direct Contracting

Sometimes, in addition to offering the pharmacy network arranged via its PBM, our network analysis suggests that a substantial advantage for the plan sponsor can be gained through entering into direct contracts with specific pharmacies, drug store chains or manufacturers, for example, in areas with high concentrations of employees or in locales not thoroughly covered by the main network.  Direct contracting with pharmacies and manufacturers can improve financial performance and member satisfaction.  We have experience in successfully negotiating the various terms of these direct contracts.

Specialty Pharmacy

Because of the high cost of specialty pharmacy therapies, GPS keeps a sharp focus on a plan’s provisions and administration in this area.  We can tailor our client’s plan to be both cost-effective and current relative to emerging specialty therapies.  We can help develop and implement a comprehensive strategy to address this rapidly growing segment of pharmaceutical costs.  Our services can include comprehensive assessment and integration of coverage between medical and pharmacy benefit programs to enhance patient care and maximize value to both members and the plan.  Essential elements of an effective specialty program include integration of disease management and case management services to ensure patient compliance and proper follow-up care to maximize the benefits of these expensive medications.

PBM Audit

Any concern that a plan sponsor may have about the performance accuracy of it Pharmaceutical Benefit Manager (PBM), can be clearly and factually addressed with a GPS-managed PBM audit.  The audit will assess claims adjudication accuracy, in particular whether or not the plan is receiving the agreed-upon discounts.  GPS audits include an on-site operational review and a reconciliation assessment.

GPS possesses in-depth knowledge and understanding of the services, systems, processes and practices utilized throughout the industry to administer prescription drug benefit programs.  This uniquely positions GPS to be able to identify administrative deficiencies that would likely remain undetected by other auditing firms.  There is a direct correlation between the ultimate value to be derived from a prescription drug audit and the knowledge and experience of those performing the service.

The GPS prescription drug audit process provides a comprehensive assessment of the entire administrative function, including accuracy, timeliness, cost controls, systems and procedures, management information, funding and internal controls.  Our audit specialists have considerable experience in claim payments, plan utilization, financial analysis, administration processes, on-line pharmacy claim processing systems, clinical programs, operational protocols and customer service practices and procedures. 

An audit can be a comprehensive assessment of the program to evaluate contract compliance, customer service performance, clinical and drug utilization review performance, claims processing performance, mail service performance, prior authorization compliance, plan design compliance, billing accuracy, reporting accuracy, eligibility, quality assurance and rebates.

An audit is a critical tool for validation and verification of vendor performance to ensure that the client receives full value from the negotiated arrangement. The process includes a formal report summarizing the audit findings.

GPS audits can encompass every component of the pharmacy benefit program, but we offer a menu of services from which to choose, so that each client can customize an audit around their specific needs.  There are three basic audit methods we utilize:  an electronic audit, an on-site operational review and a reconciliation assessment.  The electronic audit is the core of the review process and is the basis for error identification associated with proper application of basic claim administration functions.  The on-site operational review consists of an evaluation of targeted claim errors identified through: the electronic audit, review of any manual claim processes, validation of proper clinical documentation to support prior authorizations, overrides and other clinical decisions, and an evaluation of vendor operations (including a vendor-owned mail service pharmacy operation).  The reconciliation assessment is comprised of a re-evaluation of claims errors based on the results of the on-site operational review and— depending on the scope of the audit— can include a review of plan documentation, performance guarantees or incentives, and reconciliation of invoices and rebate settlements for compliance, consistency and accuracy.  The overall scope of any audit depends on the specific services to be included as part of the audit.

Competitive Bidding

Should a client come to the conclusion that its current vendor services and costs need to be viewed vis-à-vis competitors, GPS will conduct a thorough request for proposal and competitive bidding process. With our comprehensive knowledge of the PBM/PBA market, GPS brings particularly valuable experience and currency to the process. If based on competitive findings a change in vendors needs to be made, GPS handles the entire contract review and implementation process.

In those cases where the current vendor delivers unsatisfactory service and/or uncompetitive pricing, or is unable to properly respond to specific needs, GPS can customize detailed bid specifications—specific to the unique needs of each client—to ensure that vendors provide full disclosure of the features, services and price of their offer in a consistent and comparable fashion. 

Competitive bidding is also beneficial when a plan sponsor wishes to look into a service or product that is not currently a part of the program.  One example is the request for competitive quotes from underwriters of alternative pharmacy funding arrangements.  Full or partial insurance may be superior to self-funding in certain circumstances.

GPS has performed numerous Requests For Proposal (RFP) processes for clients of all sizes and can successfully implemented PBM services for these clients.  After RFPs are released, we recommend conducting a bidder conference, generally a teleconference, to review the RFP and respond to vendor questions.  We then use an objective and tailored grading processes to evaluate the vendor RFP response, resulting in a list of recommended finalists for the client.  Generally, after the finalist vendors are selected, the contract negotiation begins, discussing specific contract provision requirements.  It has been our experience that the selection of a vendor cannot be completed until primary contract issues have been overcome.  The vendor contracting and RFP process are very closely connected. 

Depending on the size or requirements of a client, a full RFP process may not be required.  In these instances, we would scale back the number of vendors included in the bidding process or the level of analytical assessment—but would still expect to conduct a thorough assessment that would yield a successful outcome.

We incorporate a proprietary methodology that assigns each vendor a score based on the components of the proposal being evaluated.  Scores are accumulated and converted to a composite rating and ranking which can be customized based on the factors most important to each client.  This analysis provides the basis for a formal report summarizing the results of the entire evaluation process.  This report will also identify which vendors should be considered for providing finalists presentations and conducting site visits.  The purpose of finalist presentations is to secure a best and final offer and to become acquainted with the personnel who will service the account.  Site visits are conducted to gain an in-depth understanding of the capabilities, infrastructure and operations of the vendor.

Assistance with the orderly implementation of the vendor selected through the competitive bidding process is needed to guarantee a smooth transition.  Implementation of a new vendor can often result in changes to certain administrative protocols that impact the member.   However, the impact to the participant can be minimized through proper management of vendor implementation processes which include data transition, review of administrative guidelines, customer service training, proper development and implementation of selected clinical programs, development of communication materials and contract review.  This process prevents the “disconnect” that can occur between vendor protocols and client expectations and reduces the “noise level” among members that so often detracts from the success of an effective drug management strategy.

Plan Monitoring

After implementation, GPS begins its post-implementation processes, in order to ensure that the plan is operating as expected and to ensure that our clients are constantly aware of the plan’s status.  The services include:

           Outlier Monitoring

Identifying patients at risk of potential harm as a result of excessive pharmaceutical consumption should be an important goal of any prescription drug plan.  GPS helps by supplying a complete drug history of their patients to prescribing physicians for informational purposes to enhance care provided to patient.  Many individuals are often treated by numerous physicians, who do not have access to the complete drug history for the patient.  This information is extremely valuable to cost management, while reducing the potential for patient harm.  This information also allows physicians to identify circumstances where patients might be receiving too many or too much of a drug or combination of drugs.

GPS also prepares summary reports of high-utilizing patients for the plan sponsor (excluding any PHI) as well as prescribing patterns of physicians.

           Customer Service

GPS has the skills to support many facets of Customer Service.  We can:

·   Assist Pharmacy Benefit Managers/Administrators with training of customer service representatives regarding unique plan features and proper handling of member inquiries, in order to minimize potential member noise and dissatisfaction with program.

·   Assist Pharmacy Benefit Managers/Administrators with development of customer service documentation to ensure call center representatives have access to complete and accurate information related to program.  This will reduce the number of calls that PBM/PBA customer service representatives will be unable to resolve on the initial call.

·   Conduct on-going reviews of customer service call center statistics and performance reports to identify opportunities to improve service through the development and implementation of program enhancements targeted to address performance deficiencies.

·   Assist client personnel responsible for handling escalated calls with resolving member issues.

         
Data Warehousing, Claim Analytics, and Reporting
(comprehensive review of claim activity)

GPS can procure and warehouse all prescription drug claim data, paid claims, reversed claims or adjusted claims, for its clients.  Our prescription claim data repository is used to provide our clients standard or customized, objective reports, including observations, analyses and recommendations.  While the frequency of these reports is based on client needs, we typically recommend quarterly.  This data is constantly available to GPS staff to help them respond timely to clients’ questions and to prepare ad hoc reports for our clients.  If a PBM electronic audit is requested, the data can be used as the basis of this audit process.

Depending on the needs and requests of the client, these reports can be built to include statistics on virtually every category of drug interest, including total cost, member cost-sharing, plan cost, AWP discounts, ingredient cost, administration fees, rebates, and sales tax. We can combine and separate data for MAC and non-MAC Generics, Preferred and non-Preferred Brands, and Supplies.  Statistics can include:

·   COST per CLAIM

·   COST per DAYS SUPPLY

·   COST per QUANTITY

·   DRUG TYPE as PERCENTAGE of TOTAL

·   AWP ANALYSIS

·   COST per SUBSCRIBER per MONTH (PSPM)

·   COST per PARTICIPANT per MONTH (PPPM)

Reports can also be generated for Formulary vs. non-Formulary, Maintenance vs. non-Maintenance, and Specialty vs. non-Specialty.

When appropriate, reports will separate Retail vs. Mail, Active vs. Retired, and Medicare vs. non-Medicare.

Renewal Evaluation

Typically in the eighth to tenth month of the plan year, a client will receive renewal notices from its Rx plan vendors, including PBMs, PBAs, and insurers. GPS will perform a renewal evaluation on the renewal offering from each vendor to determine if the renewal is reasonable, and if there is proper, credible supporting data for any requested increase in fees or rates. Where appropriate, GPS acts as a negotiator for the client to assure that renewal increases are kept to the appropriate minimum and only appropriate increases are implemented.

The evaluation of PBM renewal requests is a GPS core competency.  Nobody does it better—nobody.  Our extensive experience as consultants with deep group plan underwriting expertise and client advocacy experience afford us a unique place in the annual renewal evaluation process.  We know every nuance of the renewal process and the right questions to ask of a vendor who has not provided adequate support data for the new rates and fees they demand.  We are rigorously detailed and tirelessly inquisitive relative to every facet of the PBM renewal.

We are true client advocates in this process.  Unwarranted requests are scrutinized; supporting data is demanded.  We counsel our clients as the process unfolds, apprise them of their alternatives to accepting the renewal and, if negotiations don’t lead to an acceptable agreement, we help them plan and act accordingly.

More often than not, our fact-based negotiations with service vendors at renewal time yield an outcome that is acceptable to both our client and the vendor.  When that is not the case, we are ready and able to counsel our client about best alternatives, and lead them to a new vendor relationship that supports their needs.

Financial Analysis

Prior to the beginning of each new plan year, GPS performs a complete financial analysis for each client that includes cost forecasting, development of budget rates, and assistance in establishing appropriate employee contributions. 

Reviewing historic prescription drug claim experience is critical to assessing plan performance.  It allows GPS to provide advice and assistance in improving plan management, enhancing the quality of patient care, and reducing costs.  Identifying key cost drivers helps clients to focus on solutions specific to the problems unique to their own plan.  The identification of specific cost drivers is part of the foundation of establishing an effective pharmacy benefit management strategy.

Historical Rx claim experience is also the foundation of addressing the fiscal aspects of a plan.  Our staff has extensive underwriting expertise.  This skill set directly applies to projecting future plan costs, establishing self-funded premium-equivalency rates (also known as ‘accrual rates,’ ‘budget rates,’ or ‘COBRA rates’), and helping plan sponsors determine appropriate “employee contributions” required from members to participate in the plan.  For benefit programs that entail multiple employee/member plan options, setting appropriate employee contributions is critical to the success of the program.

GPS has financial tools that support cost projections from basic to highly sophisticated, depending on the needs of the client.  We take into account anticipated changes in AWP discounts, dispensing fees, administrative fees, rebates, historic/future plan revisions, and separate trend assumptions for unit cost vs. utilization.  Our analysis is separated between Retail vs. Mail, Brand vs. Generic, Preferred Brand vs. Non-Preferred, and MAC Generic vs. non-MAC Generic.

Alternative Plan Designs

At any time during the plan year, GPS is available to model alternative plan designs and provide our client with an estimate of each option’s impact on plan cost. 

GPS performs financial modeling of actual historical claim data and variance analyses to develop recommended plan design options.  This process is very precise, and is normally based on one to two years of our client’s historical claim data to use as the baseline.  We work directly work with the client’s PBM to obtain claims data to use as the basis of our benefit analyses, cost forecasts and benefit design modeling.  In those instances where we are not able to obtain this data, we employ our proprietary prescription drug manual rating tool that can be used to provide relative rate analyses by modeling changes to any plan design feature.  We also possess industry normative data that can be used to supplement this type of analysis.

Member Communications

We can also develop customized communication material, both print and electronic, for members, providers and other plan stakeholders.

Communicating accurately and effectively about pharmacy issues, plan details, consumer awareness, emerging therapies, and the like requires great skill, and attention to detail.   Verbal skills and visual creativity help make good communications.

We have experience developing customized communications materials directed to all, or a selected group of plan stakeholders, including plan participants, physicians, pharmacies, vendors and others.  We utilize appropriate opportunities to educate and explain.  We support the plan sponsor’s objectives of improved acceptance, compliance and performance of the program.

We are a full service communications arm for our clients.  We counsel as to the type of communications piece best suited to the situation.  We compose the text for the communications piece, whether electronic or print.  We design the overall look and layout of printed materials.  We oversee the production of all printed materials on behalf of our clients.  We distribute the materials to the chosen audience if our client so desires and can provide us with the delivery data we require, or we ship the produced materials to our client’s specified location for their handling.

We are a true communications partner to our clients in this complex and changing field.

Eligibility Management

And, to minimize its administrative burden, we can assume the responsibility for eligibility management for the plan.  GPS utilizes a web-based system so our client’s can easily record member eligibility changes.

Prescription drug eligibility is often a function of a plan sponsor’s payroll deduction system or medical eligibility process.  However, this may fail to accurately or adequately reflect needed coverage information for prescription drug benefits.  In addition, programming effort is usually required to interface standard eligibility data files with each service vendor.  We have created our own Web-based eligibility system that allows a client to maintain their prescription drug benefit eligibility separate from their other management systems.  This process includes a load of an initial eligibility file from the historical data source.  Going forward, the client’s administrative staff is able to update this data through easy and secure access using their own systems.  This includes handling updates with the service provider so client programming and disruption is minimized when a change in service provider occurs.  Service also includes periodic eligibility reasonableness edits and reporting to assist the client is acting on eligibility records that many have fallen outside of established coverage rules. The system is HIPAA-compliant.