Strategic Rx Stewardship Introduction

This post launches a 14 week series on Strategic Rx Stewardship. Over the course of the series, we’ll use the letters of R X S T E W A R D S H I P to introduce and explain a fundamentally different approach to managing the self-funded employer drug spend.

Our mission: help self-funded employers turn their Rx Spend into an Rx Investment. Northwind helps our clients become good stewards of their Rx Investment.

Self-funded employers have a drug problem and it isn’t just about costs. We want our money to be spent well. We want to know what it’s doing for us and for our employees. We want to monitor what we’re spending, optimize how it’s spent, use it to influence what it can, and then gauge its impact on desired objectives. Our problem isn’t the costs, it’s that we feel powerless to do anything about them or their results. When it comes to our investment in medications for our employees, ours is a problem of stewardship.

The current system of pharmacy benefit management is failing to meet the needs of the employers for which it was built to serve and the employees they seek to benefit. How so? The current PBM model simply pushes money around. It is an administrative function rather than a strategic function. Amid all of the distractions of formularies, re-pricings, claims, therapeutic interchange, step therapy, prior auths, brands, rebates, and specialty drugs is lost the ultimate objective: cost effectively supporting the health and welfare of the employee and his/her dependents to their benefit and to the benefit of the sponsoring employer. 

Today’s traditional PBM approach does not steward the employer’s drug investment well and has grown to be most effective at one thing: shifting margin into its own business model. Benefit administration has become an end unto itself and the key stakeholders are really just an afterthought. PBMs have gotten pretty good at administering plans but remain quite poor at making any meaningful difference for employers or employees.

A Different Approach

We need a way to steward our Rx investment strategically. A fundamentally different approach from traditional pharmacy benefit management. Strategic Rx Stewardship would encompass what our PBMs were originally built to do for us (provide access to meds, improve buying power, administer members and claims, and report on activity) but would add four critical ingredients: 1) real-time visibility into our active Rx investment, 2) actionable insights on key challenges and opportunities, 3) more influence over our investment as a real benefit to employees, and 4) mechanisms for ongoing monitoring and measurement of our Rx investment so adjustments can be made.

The answer is not pushing more drugs to more patients more efficiently, but to use the Rx investment as a mechanism to engage employees in employer sponsored healthcare while empowering them with access to more cost effectives medications. Today, PBMs represent an opaque world of competing incentives, hidden costs, and access restrictions rather than a mechanism that empowers good stewardship of our Rx investment.

Strategic Rx Stewardship

Strategic Rx Stewardship is comprised of three key elements:

• Insights into drug spend, employee behaviors, and health outcomes.
• Influence over employee health through access to cost-effective medications and coordinated medical programs delivered through sponsored health partners.
• Impact measurement and real-time feedback on programs designed to improve outcomes.

Employer-sponsored health centers can be the lever to drive better Rx stewardship. A sponsored clinic should be the nexus of care and give the employer a hand in influencing the health of its employee population; not by involvement in clinical decisions but through implementation of targeted programs.

With insight into areas of opportunity and mechanisms for participation in, and influence over, clinical programs, the employer can dramatically increase its ability to steward its Rx investment appropriately. However, good stewardship is incomplete without effective measurement of outcomes. Real-time feedback on progress and effectiveness of money spent on medications for employees is the final piece of Strategic Rx Stewardship.

By understanding what money is being spent, what programs are being offered, the level of engagement in those programs, and clinical measurements or outcomes, the employer can determine if the Rx investment is meeting objectives or if adjustments need to be made. With real-time impact measurement, the employer can act in new ways to steward dollars invested most effectively.

The time has come to seize control over our drug investment and its results. The time has come to change how we approach that investment and what we expect from it. We don’t need pharmacy benefit management, we need Strategic Rx Stewardship.