To decrease their ever-increasing prescription coverage costs, most health plans conduct RFPs (Requests for Proposal) to force PBMs to compete against each other. However, almost all RFPs do little, if anything at all, to change health plans’ costs. Thus, most PBM RFPs prove to be an utter waste of time and resources.
Pharmacy Benefit Consultants conducts an entirely different form of RFP, and our clients’ costs do change.
What’s the Difference Between Other Consulting Firms’ RFPs and Our RFPs? Other firms conduct RFPs as if they are “beauty contests”. These firms issue questionnaires to PBMs, and obtain “representations”, “promises” and “projections” in response, but never require PBM contestants to incorporate any of the above into binding contract terms. Moreover, on the rare occasions when these consulting firms spend any RFP time whatsoever on the PBM/client contract, these consulting firms typically “lift” the structure and contract terms of existing PBM/client contracts. As a result, clients end up with contracts that are stuffed with ambiguities and loopholes, meaning any improvements in AWP discounts or guarantees that are obtained from the RFP will be of little, if any, value.
In contrast, our firm realizes that a PBM RFP must be a legal process to extract an entirely different form of contract — that is devoid of ambiguities and loopholes — from the PBM marketplace. Accordingly, we draft such a contract that is tailored to each of our client’s needs at the beginning of the RFP, issue our RFP with our contract attached, and demand that all PBM contestants accept our form of contract — or something very similar — or be eliminated from the RFP.
During the RFP, we use the RFP “competition” to extract better and better, binding pricing terms and guarantees from PBM contestants, memorializing all such terms in the contracts that we have drafted, and thereafter requiring all contestants to sign and thereby bind themselves to the terms they have proposed.
As a result, when we analyze PBM contestants’ proposed contract pricing and contract guarantees toward the end of our RFPs, we analyze the actual numbers that your plan will be paying when it selects a PBM — not PBMs’ “promises” and “projections” about what they might – but never do – implement.
Moreover, while most consulting firms conclude their RFPs when a Finalist is selected – without discussing, let alone finalizing the PBM contract – on the day our RFPs are over, our clients are in a position to sign an entirely different form of contract that has been thoroughly negotiated during the RFP.
Review Our Free Materials. We have created a two-part video – and written and published several articles — to help all health plans better understand how to conduct RFPs. Download our materials – for free – and review them in the privacy of your office – and you will take the first steps toward conducting an effective PBM RFP.
Download: Video – Part I
Download: Video – Part II
Download: Cover Story Article in the IFEBP’s Journal: “How to Conduct A Successful PBM RFP”
If you are considering conducting a RFP: We urge your plan to contact Pharmacy Benefit Consultants for a free consultation on how to do so.
If your plan has already begun its RFP – and you now realize your consulting firm is without the legal skills to draft and negotiate an entirely different form of contract – we urge your plan to contact Pharmacy Benefit Consultants to salvage your RFP, before it is too late to do so. Other health plans have called us right before they have concluded RFPs, and thereby rectified their situation and saved large sums of money by obtaining an “airtight” PBM contract from their RFPs. Your plan can do so as well.