A PBM services agreement is a contract between a pharmacy benefit management (PBM) company and a client (usually an employer or health plan) that outlines the terms of the PBM services provided. PBMs are third-party administrators who manage prescription drug benefits for health plans, insurers, and employers.
An effective PBM services agreement is critical to ensuring that PBMs operate effectively and efficiently while providing value to their clients. PBMs are responsible for negotiating drug prices with manufacturers, developing and managing formularies, processing claims, and coordinating with pharmacies and healthcare providers to ensure that patients receive the medications they need.
The PBM services agreement typically includes provisions related to the scope of services, pricing, performance guarantees, data reporting, and audits. The agreement should clearly outline the services that will be provided and the responsibilities of both the PBM and the client.
Pricing is a crucial aspect of the agreement, and the contract should clearly define the fees that will be charged for PBM services. PBMs typically charge a per-member-per-month fee and/or a percentage of the total prescription drug spend. The agreement should also specify any performance guarantees, such as minimum savings or maximum rate increases.
Data reporting is another important aspect of the PBM services agreement. PBMs are responsible for providing their clients with detailed reports on drug utilization, cost trends, and other metrics that can help clients better manage their pharmacy benefits. The agreement should specify the frequency and format of these reports.
Finally, the PBM services agreement should include provisions for audits to ensure that the PBM is complying with the terms of the agreement and providing value to its clients. The contract should specify the frequency and scope of audits, as well as the consequences of any non-compliance.
In summary, a well-drafted PBM services agreement is critical to ensuring that PBMs operate effectively and efficiently while providing value to their clients. The agreement should clearly define the scope of services, pricing, performance guarantees, data reporting, and audit requirements. With a robust agreement in place, clients can be confident that their PBMs are delivering the best possible pharmacy benefits to their members.