Background
       Memorial Hermann Health Plan (MHHP) is owned by Memorial 
   Hermann Health System with the purpose of focused utilization of 
   Memorial Hermann facilities and affiliated organizations. 
       A Health Plan is a legal entity that provides for coverage of designated 
   health services such as vision, dental, medical, and pharmacy services 
   needed by plan members for a fixed, prepaid premium. Health plans 
   are marketed directly to individual members and employer groups.
  Objectives & Introductions
   •  Provide basic components of a PBM 
      function and business model
   •  Define PBM relationship with Health Plans
   •  Understand formulary management
   •  Understand utilization management 
      programs
   •  Manage Care impact for students
   •  Q & A 
  What is a PBM?
   •  A Pharmacy Benefit Manager (PBM) is a 
      third party vendor that provides programs 
      and services designed to maximize drug 
      effectiveness and contain drug 
      expenditures.
  Do you work for a PBM?
   •  NO. They work for me.
   •  A PBM seeks to do business with Health 
      Plans to manage the Health Plan’s 
      pharmacy or medical drug benefits. 
   •  Director of Pharmacy Service owns the 
      vendor relationship and ensures quality 
      of service for delegated functions.
  What Services do PBMs 
  provide?
   •  Serve as middleman between health 
      plans and wholesalers or pharmaceutical 
      companies
   •  Administrative services in processing and 
      analyzing prescription claims
   •  Contracting with a network of pharmacies
   •  Negotiating rebate arrangements
   •  Developing and managing formularies 
      and prior authorization programs