Plan sponsors of pharmacy benefit plans continually balance plan performance and cost with the daily demands of plan administration. As plan designs and competitive pressures mount, there is one aspect that is increasingly becoming a factor all plan sponsors should address.
This factor is the risk assumed by the plan fiduciaries under code section 29 U.S.C. § 1002(21)(A) and what gaps there may be between what is expected by plan participants vs. what is delivered as the pharmacy benefits are administered and paid out to them. An increasingly utilized tool by plan sponsors is a plan audit.
The reasons are many. First, plan sponsors see that the benefits often outweigh the costs of doing an audit. There are several different types of audits which can be conducted from the plan design itself to eligibility administration to how rebates are handled and finally to the contract and whether performance guarantees are being met.
One area of concern to many plan sponsors and fiduciaries related to increasing pharmacy plan costs are court cases and litigation against PBMs (Pharmacy Benefit Managers) and carriers for inflated drug prices.
One example are kickbacks from drug manufacturers to PBMs for payments related to discounts, rebates, or other fees to provide a preferred formulary.
If you are a pharmacy plan fiduciary and are seeking ways to lesson exposure from the fiduciary risks to the plan and perhaps to you, consider adopting a regular process of pharmacy plan audits to document management oversight and to maintain plan efficiency through possible plan recoveries from the improper contractual and plan design administration by your PBM.
You might think of this as somewhat of a plan fitness report. Much like we all try to watch our diet and embark on a fitness regimen; a pharmacy plan audit could be considered in much the same light.