Pharmacy Benefits Manager Exam 3 Lecture From 10/23/20 Flashcards Preview

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Flashcards in Pharmacy Benefits Manager Exam 3 Lecture From 10/23/20 Deck (29)
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1
Q

Per claim fees paid by clients to PBMs for services like claims processing. Also used
to denote the fees paid by manufacturers to PBMs for administering formulary rebate contracts

A

Administrative Fees

2
Q

A published suggested wholesale price for a drug, based on the
average cost of the drug to the pharmacy. AWP is often used by pharmacies to price prescription drugs

A

Average Wholesale Price (AWP)

3
Q

The administration of drug benefit designs. It includes setting up and
maintaining the drug coverage and exclusions, setting limits on drug coverages, and defining member
cost sharing requirements

A

Benefit Administration

4
Q

A very rare contract among PBMs. It is used when a PBM agrees to assume
financial risk for a client’s drug spending. Capitation is a set dollar amount, established by analysis of
pharmacy claims data, used to cover the prescription costs for a member, usually set at a per member
per month rate (PMPM)

A

Capitated Contract

5
Q

The online processing of a prescription drug claim. Most claims are submitted
electronically at the point of service (the retail or mail pharmacy)

A

Claims Adjudication

6
Q

A MCO, employer, or insurer that contracts with a PBM to administer their drug benefits and
cost control programs.

A

Client

7
Q

A fixed dollar amount paid for every prescription

A

Co-pay

8
Q

The fixed percentage members pay of the cost of each prescription

A

Co-insurance

9
Q

A specific annual dollar amount that a member must pay out-of-pocket for prescription
drugs before the drug benefit program begins

A

Deductible

10
Q

Programs developed by PBMs to identify and categorize patients
(especially those with chronic conditions) and to direct these patients towards a specific treatment
protocol

A

Disease Management Programs

11
Q

The most common pricing arrangement PBMs have with their clients. Under
the contract, PBMs are paid for the administrative services they provide, and they do not assume the
risk for the cost of the drugs dispensed

A

Fee-for-Services Contract

12
Q

An approved list of branded (and generic) drugs developed by the PBM, or the client

A

Formulary

13
Q

A list of recommended drugs. Under this structure all drugs are reimbursed
irrespective of formulary status. However, a client’s plan design may exclude certain drugs (OTC,
cosmetic, and lifestyle drugs)

A

Open Formulary

14
Q

An incented formulary applies differential co-pays or other financial
incentives to influence patients to use, pharmacists to dispense, and physicians to write
formulary products

A

Incented Formulary

15
Q

A closed formulary limits reimbursement to those drugs listed on the
formulary. Non-formulary drugs are reimbursed if the drugs are determined to be medically
necessary, and the member has received prior authorization

A

Closed Formulary

16
Q

The cost to the pharmacy for dispensed drugs (AWP – discount %)

A

Ingredient Cost

17
Q

Mail pharmacies dispense a 90-day supply of drugs through the mail; typically used for
chronic conditions. Most pharmacy benefit plans offer a mail pharmacy service as a way to promote cost
savings and improve access

A

Mail Pharmacy

18
Q

A broad term encompassing a variety of healthcare delivery
systems utilizing group practice and providing an alternative to fee-for-service health plans. The primary
goal of a MCO is to create incentives to use a prepaid and organized healthcare system that serves a
defined population

A

Managed Care Organization (MCOs)

19
Q

A company that manufacturers branded and/or generic pharmaceuticals

A

Manufacturer

20
Q

The price basis for generic drugs which is typically 50–60% below
AWP. PBMs can either set the MAC prices themselves, or use the MAC prices set by HCFA for Medicaid
beneficiaries

A

Maximum Allowable Cost (MAC)

21
Q

Per member per month; in an employer plan includes employees and their covered
dependents

A

PMPM

22
Q

A company providing administrative and clinical
services through a complex system that includes retail pharmacies, manufacturers, clients, physicians,
and members. These companies administer drug benefits and drug cost control programs for their
clients, and secure substantial discounts from retail pharmacies and drug manufacturers. PBMs establish
and maintain large pharmacy networks with chain and independent pharmacies. Also, PBMs contract
with manufacturers of branded products to receive rebates and administrative fees

A

Pharmacy Benefit Manager/Management (PBM)

23
Q

Specifies which pharmacies are approved for members, and includes retail, mail,
and in some cases specialty pharmacies

A

Pharmacy Network

24
Q

A prior approval process that allows prescription drugs to be dispensed to
members only when specific conditions have been met

A

Prior Authorization

25
Q

A contract between a PBM and a client that provides incentives for both sides
to collaborate and run the pharmacy benefit effectively and to share in the overall cost savings

A

Shared Savings Contract

26
Q

Typically operated in mail pharmacies to encourage physicians and
patients to switch from the drug prescribed to lower cost, comparable drugs. Substitution requires
physician and typically member permission

A

Therapeutic Substitution Programs

27
Q

Paid by manufacturers to PBMs for the sale of branded drugs to PBM members

A

Rebates

28
Q

The price pharmacies charge to cash paying customers for prescription
drugs.

A

Usual and Customary (U&C)

29
Q

Programs designed to lower drug costs and utilization and to
encourage the use of generics or preferred products. These programs include services such as prior
authorization, drug utilization review (concurrent and retrospective), academic detailing programs, and
patient education

A

Utilization Management Programs