Real Questions, Real Answers: Utilization Management

Renee Rayburg, RPh
Libby Johnson
January 7, 2021

We are building on the ongoing discussion about the topics that matter to health plans right now. It started with “Unpacking utilization and medical pharmacy integration” and “Understanding the adoption and pipeline for biosimilars.” Today Renee Rayburg, RPh, and Libby Johnson continue with utilization management.


Part Three: Utilization Management – How to achieve best practices in the managed care space

Q:  Health plans are already actively applying prior authorization, step therapies, and many other utilization management strategies to control both overall cost and trend.

While many of these things are in place already, what advice can you offer about optimizing utilization management? Where do you see utilization management not working as well as we’d hope it would?


Renee Rayburg:

Utilization management is crucial because we are all concerned about expensive drugs, but it doesn’t matter how expensive a drug is if no one is using it. What matters if you have this costly drug and have many utilizers is the balance between managing both cost and utilization.

Today, most specialty drugs for any health plan and most payers are managed with some prior authorization process. We hear all the time: “Oh, we have a PA on this drug.” I find it interesting that, sometimes, hard questions still need to be asked even with great criteria. How well is this prior authorization or utilization management you have in place working? Here’s where health plans need to be able to use the data.

The tools that we utilize help us because it gives us that visibility to look and see:

  • Are the drugs being used for the right diagnoses?
  • For the right patient?
  • For the right frequency and duration?
  • In the right quantity?

All of these things are extremely important when it comes to some of these exceptionally high-cost specialty drugs. The purpose is to ensure the appropriate use, not necessarily to create barriers but to ensure that criteria being developed can identify the right patients for those drugs based on all of those things that I mentioned earlier.



Q:  Have you encountered any shortcomings or any common challenges?


Renee Rayburg:

We see some of the shortcomings because health plans might have great criteria, but the process becomes a “check the box” kind of process.

Electronic PA systems have improved the process for providers and members. But we want to make sure that we’re not losing the importance of documenting and confirming the diagnosis and document the use of measurable markers when they are available such as lab values or specific diagnostic tests that are important in the confirmation of a diagnosis, those types of things.

Another missing piece can be the assessment of whether drugs are working. We believe you should pay for drugs, even if they are expensive because they help patients. But do you know if they’re helping patients, and do you have a way to assess whether or not they are working or the patient’s condition has benefited as a result of the drug therapy?


Q:  Are there any examples you can share?


Renee Rayburg:

Consider hereditary angioedema (HAE). It’s a very rare condition, and people need access to the drug. In the past, we have seen plans and PBMs confirm an HAE diagnosis and then allow the patient to have the drug authorized forever, without looking at the quantities or checking on whether the medication is working.

Now we fast forward a couple of years, and for some clients with a lot of HAE utilization, we see some concerns. To us, it’s important to have stringent criteria that include the use of measurable markers to confirm the diagnosis. Have the collection of documentation as confirmation, even if it’s to demonstrate the use of previous therapies. Also, have a reasonable approval duration so that renewal criteria assess how the drug is benefiting the patient.

Even in categories like inflammatory conditions, there are many products out there used for plaque psoriasis today, and some may even work better than others. We have visibility into the data and understand the tremendous cost consequences of inappropriate use. It’s imperative to align the criteria and ensure the appropriate use. Then you can feel that you have made the right investment in your patients on these high-cost drugs.



Q:  Every time we invest in a medication, whether it’s an excess quantity or a medication that isn’t warranted for a diagnosis, we’re paying for something that we could be spending elsewhere. It’s a matter of making sure every dollar is going toward something that matters, something that can deliver an outcome. I know in working with you, the times we’ve found things like excess quantities or waste in the specialty category, it’s surprising. We just can’t afford that in the system today. The ability to detect those opportunities or issues is critical. Libby, what would you add to this topic?


Libby Johnson:

In some of the plans that I’ve worked with, we continuously run into the importance of ensuring alignment of the policy across benefits. As we’ve reiterated throughout this series, integrated data and the value of looking at things across both benefits is quintessential. Understanding things like: what’s my policy on the medical side and what are my criteria? Does it match my criteria on the pharmacy side?

Many health plans that I work with have a varied structure in terms of factors like: are their teams together, are they under the same umbrella, or do you have completely separate teams that are managing both? Even in the case where you have teams that are not under the same umbrella within the organization, ensure cohesiveness in terms of when you’re doing the policy reviews.

I know Renee has encountered this, too—as we think about utilization management, we need to think about the duplication of therapy. Most plans that I talk with feel like there’s a lack of visibility or “low-hanging fruit” when you look at drugs or even therapies occurring across both benefits.



Q:  Are there any specific examples you can recall illustrating that lack of visibility?

Libby Johnson:

As an example, we were recently working with a plan where they had two drugs (one on the pharmacy benefit, one on the medical side) in the inflammatory category. In that case, the pharmacist we were working with was baffled because we’re trying to make sure that we’re not paying for inappropriate drugs, but also considering patient care.

There was a level of worry about what this is doing to the patient. Does the patient know that they shouldn’t have both drugs?

In that case, there was outreach to intervene with the provider, thereby reducing utilization from a duplicative perspective.

There are table stakes PAs out there to Renee’s point, but there are different ways and thoughts of what can be done from an overall optimal management perspective.


Renee Rayburg:

When you think about all the different functional areas within a company, sometimes even between companies, between a PBM and health plan, between a health plan and a care management organization, the ability to align around data is critical. Working from a shared set of information helps manage costs, and sometimes, Libby, to the vital point you made earlier, these issues can be a matter of patient safety.

Health plans need to align information and strategy across groups with the same goal: cost and quality of care. Without the benefit of data, plans may not be able to achieve those goals consistently.


Stay tuned for the next part in this series, Specialty & the Medical Benefit: Specialty management and medical reimbursement strategies, launching shortly.

If you don’t want to wait for more information, download the 2020 State of Specialty Spend and Trend Report today!

Renee Rayburg helps lead Artemetrx services in Clinical Consulting with more than 30+ years in pharmacy and medical benefit management to support our health plan sponsors, providers, and patients.  Her thought leadership and passion for specialty pharmacy continues to influence the market, including important changes to specialty vendor clinical management products for the betterment of clients.

Libby Johnson currently leads the analytics, reporting, and data management team. She has over 16 years’ experience providing cost and trend management strategies to clients through unique data intelligence and analytics. Her expertise includes developing strategic cost solutions, creating advanced and specialized data and financial analysis plans, analyzing forecast and trend developments, and evaluating pricing and cost strategies and tactics. One of Libby’s key strengths is assisting clients in designing and deploying strategies to improve overall trend management program performance.