It’s Time to Develop Your Fiduciary Responsibility Policy for PBM Services

March 3, 2025

Healthcare costs will once again hit historic highs in 2025, making it more critical than ever for brokers, TPAs, employers, and labor unions to understand their fiduciary obligations. Fiduciaries are held to the highest standard of conduct regarding the management of program funds. This means acting in the best interest of plan members while ensuring plan assets are spent wisely and accounted for. Managing pharmacy benefits includes navigating conflicts of interest, traversing opaque pricing, and evaluating rebate compensation, making it challenging to ensure compliance in today’s healthcare environment. Leveraging years of expertise, ELMCRx aids stakeholders by providing clear, compliant management of pharmacy benefits, reinforcing the integrity required in today’s market.

The Importance of Disclosure and Payment Integrity

At the heart of fiduciary responsibility is the duty to disclose. Brokers and TPAs are required to act in the best interest of their clients, and transparency around decision-making and compensation is crucial in fulfilling these duties.

Pharmacy Benefit Managers (PBMs) play a critical role in managing drug benefits, as they are uniquely positioned to both approve prescriptions and dispense medications. This dual role can create the potential for conflict of interest, particularly in cases involving high-cost specialty drugs, as they are approving high-cost care and benefitting financially.

An effective way to mitigate conflicts of interest in pharmacy benefit management is through the independent review of high-cost medication requests. Transitioning the role of gatekeeper and dispenser from the PBM to an unbiased third party ensures high-cost prescription claims are managed impartially. This change ensures that plan member requests align solely with clinical guidelines and plan parameters, leading to the approval of medications that are:

Appropriately priced
Dosed correctly
Appropriate for care

This strategy not only demonstrates a robust level of stewardship over plan assets but also reinforces the commitment to fiduciary duties by ensuring that treatment decisions are made with the utmost integrity.

The Case for Independence

Taking independent review a step further, carve-outs for specialty prior authorizations provide a comprehensive strategy for managing high-cost drugs. By separating the approval process for specialty medications from standard PBM operations, fiduciaries establish clear boundaries between PBMs’ financial interests and clinical decisions, ensuring unbiased, patient-focused outcomes.

On top of ensuring unbiased clinical decisions, with specialty drug carve-outs, fiduciaries can provide comprehensive reports detailing:

Clinical rationale for approvals or denials
Adherence to treatment guidelines
Assessment of drug efficacy and cost-effectiveness

This level of transparency builds trust with plan members and demonstrates a commitment to patient-centered care while maintaining compliance.

Ongoing Payment Integrity and Claims Monitoring

Beyond the carve-out of prior authorizations, ELMCRx’s independent monitoring solutions play a crucial role in maintaining ongoing fiduciary responsibility. By continuously reviewing claims for compliance and cost-effectiveness, ELMCRx assists fiduciaries in identifying and addressing any potential overspending or mismanagement of resources.

This continuous monitoring framework allows plan sponsors and brokers to confidently ensure they are acting in the best interests of their members. While regular audits are a part of this process, the current focus is on establishing robust monitoring mechanisms rather than in-depth auditing. This approach provides the necessary oversight to ensure adherence to compliance standards and contractual agreements without over-emphasizing payment discrepancies at this stage.

By proactively identifying potential issues in claim management, ELMCRx enables fiduciaries to make informed adjustments that align with the financial goals of the plan and enhance the health outcomes of its members.

An Independent Path Forward for Fiduciaries

The present state of healthcare poses numerous challenges for brokers, TPAs, and plan sponsors, who are increasingly pressured to fulfill their fiduciary duties. Given the rising specialty drug costs and the inherent conflicts within the PBM model, carve-outs for specialty PAs are crucial.

ELMCRx provides solutions that tackle these challenges head-on, assisting fiduciaries in delivering optimal outcomes for their members and funds. Through the use of an independent carve-out model and continuous payment integrity services, fiduciaries are able to uphold transparency, maintain compliance, and ensure the financial stability of the plans they oversee.

Keep your healthcare plan compliant and transparent. Contact ELMCRx to see how we support plan sponsors like you.