Transcript Part 1
How do Hospitals, HMOs, Pharmacies and PBMs interrelate? Hospitals and HMOs • HMOs contract with hospitals for inpatient services including medication needs. Hospitals and HMOs • HMOs contract with hospitals for inpatient services including medication needs. • Discharge medications are generally not included in contract. Hospitals and HMOs • HMOs contract with hospitals for inpatient services including medication needs. • Discharge medications are generally not included in contract. • Hospital pharmacy is usually not contracted with HMO for outpatient medications. Hospitals and HMOs • HMOs contract with Hospitals for inpatient services including medication needs. • Discharge medications are generally not included in contract. • Hospital pharmacy is usually not contracted with HMO for outpatient medications. • Hospital and HMO formularies are usually separate. Issues and Conflicts • HMO and Hospital formularies cover different products. Issues and Conflicts • HMO and Hospital formulary cover different products. • Patient may not be able to get discharge medication from hospital pharmacy. Issues and Conflicts • HMO and Hospital formulary cover different products. • Patient may not be able to get discharge medication from hospital pharmacy. • Discharge medication may not be on plans formulary. HMOs and Pharmacies • HMOs generally contract with a broad network of community based stores at a discount off AWP plus a dispensing fee per prescription. HMOs and Pharmacies • HMOs generally contract with a broad network of community based stores at a discount off AWP plus a dispensing fee per prescription. • HMO generally does not reimburse for other services beyond basic dispensing. HMOs and Pharmacies • HMOs generally contract with a broad network of community based stores at a discount off AWP plus a dispensing fee per prescription. • HMO generally does not reimburse for other services beyond basic dispensing. • Pharmacy must process claim through HMO’s chosen PBM system. Issues and Conflicts • Pharmacies profit margin Issues and Conflicts • Pharmacies profit margin • Cognitive services Issues and Conflicts • Pharmacies profit margin • Cognitive services • Under a fee for service system, pharmacy is incented to increase the number of prescriptions dispensed Issues and Conflicts • Pharmacies profit margin • Cognitive services • Under a fee for service system, pharmacy is incented to increase the number of prescriptions dispensed • Discounts and Rebates HMOs and PBMs • HMOs contract with PBMs to provide one or more of the following: – – – – – – – pharmacy network claims processing DUR reports formulary management rebate management clinical services disease management HMOs and PBMs • HMOs generally pay PBM for services based on a per claim fee schedule. HMOs and PBMs • HMOs generally pay PBM for services based on a per claim fee schedule. • PBMs retain a portion of rebates collected as an additional service fee. Issues and Conflicts • PBM makes more money as more claims are processed. Issues and Conflicts • PBM makes more money as more claims are processed. • PBM makes more money as more brand products are dispensed. Resolutions?