After the Procurement: Ensuring a Seamless PBM Implementation

Immediate Post-Procurement Considerations for Employers

Key Points

• A successful PBM implementation is just as critical as procurement and directly impacts member experience and financial outcomes.
• Allowing sufficient time (ideally six months) for implementation reduces errors and sets the stage for long-term success.
• Rigorous testing and auditing before and after go-live help catch issues early and validate contractual performance.
• Monitoring member feedback and pricing fluctuations can reveal hidden problems and protect against financial shortfalls.

You’ve invested considerable resources in a comprehensive procurement for your pharmacy benefits. While finding the right PBM partner and securing a favorable contract is a significant milestone, you’re still only beginning this journey. Implementation is the next phase that determines whether your negotiated terms translate into real value for your organization and members. This phase establishes the foundation for your pharmacy benefits strategy, with little margin for error. The following are proven strategies to help you navigate a successful PBM implementation while avoiding common pitfalls.

Why Does Implementation Demand Strategic Focus?

A PBM transition affects every aspect of your pharmacy benefit delivery, from member access to cost management. Poor implementation can result in member disruption, increased administrative burden, and financial exposure that may not surface until well into the contract term. Conversely, well-executed implementation creates a strong foundation for a seamless member transition, PBM relationship success, and optimal financial performance.

Organizations experiencing implementation challenges are significantly more likely to encounter ongoing operational issues throughout their contract term. This reality underscores why implementation deserves the same strategic attention as the initial procurement process.

What are the Top Employer Considerations for Implementing a New PBM?

The following areas are crucial to understand in order to best support your business and pharmacy benefit strategy.

Timeline: The Foundation of Success

The most critical factor for implementation success is establishing an adequate and well-documented timeline. Compressed implementation schedules exponentially increase the likelihood of errors, which can lead to member friction and strain your relationship with your new PBM partner from the outset.

At a minimum, a procurement can be completed within 90-120 days. However, if possible, we recommend allowing six months for PBM transitions, especially for organizations with complex benefit designs or large member populations that will require additional time. Your PBM should provide a detailed project timeline with clearly defined milestones, a robust test plan, regular status updates, and explicit identification of deliverables requiring plan sponsor input or approval.

Understanding that plan setup at a new PBM follows a sequential process is crucial. That means delays or errors in early phases can create significant complications in later implementation stages. As with any complex project, the quality of initial inputs directly influences final outcomes, making it essential that all documentation provided to your PBM is accurate, complete, and clearly articulated.

Customizations: Preserving What Matters

Collaborate closely with your current vendor to develop a comprehensive inventory of customizations implemented over your contract term. These modifications may include custom drug exclusions or coverages, utilization management protocols, member-specific overrides, copay card/copay maximizer strategies, or carve-out vendor setups in a Modular PBA approach.

Many organizations choose to adopt the new PBM’s standard configuration for formulary management, utilization management, and regulatory-related coverages such as Affordable Care Act or Safe Harbor requirements. However, customizations developed at your current vendor rarely transfer to your new partner. It’s essential to document and evaluate each modification to determine its ongoing value and feasibility within your new PBM’s operational framework.

Maintain detailed documentation of all customizations, including the business rationale for each modification and its impact on member experience or cost management. This information can be more easily transferred to your new PBM partner to prevent member abrasion and/or wasteful spend.

Test and Monitor: Validation Before Go-Live

Thoroughly review all documentation provided by your PBM to ensure accurate interpretation of your benefit configuration. Verification of plan setup accuracy can’t be delegated solely to the PBM – it is a shared responsibility with the benefit team.

Request access to test claims processing within your new vendor’s configuration environment and review the results with your consulting and PBM teams. Comprehensive front-end testing prevents member-facing errors and costly corrections after go-live. Specifically request that your PBM create test scenarios that mirror any plan customizations carried over from your previous vendor.

Ensure contractual implementation guarantees are being monitored and met throughout the process. Address any identified shortfalls proactively rather than waiting for your PBM to self-report issues.

Conduct a pre-implementation audit with sufficient lead time before go-live to establish a baseline and identify critical issues, setting the foundation for the post-implementation audit’s analysis of real-world production data. Following go-live, execute a post-implementation audit to verify that production claims are processing according to contractual guarantees. This step is particularly important for identifying and addressing financial performance shortfalls before year-end reconciliation processes (which typically occur 18 months after your program goes live), when corrective options may be limited. 

Listen to Your Members: Early Warning System

PBM transitions typically involve changes in pricing structures, formulary coverage, and utilization management protocols. Members taking chronic medications who haven’t experienced recent benefit structure changes may encounter unexpected pricing variations or coverage modifications during the transition.

To minimize disruption, establish clear channels for member communication and ensure that reported issues receive prompt, thorough investigation. Member disruption can serve as an early indicator of configuration errors or processing issues that may not be immediately apparent through standard monitoring processes. A way to monitor this is to require the PBM to provide regular reports showing the reason for member calls to customer service, which can help identify issue patterns.

Pricing fluctuations can occur, particularly for generic medications subject to Maximum Allowable Cost (MAC) pricing, as MAC lists vary significantly between PBMs. While some pricing variations are expected and reasonable, others may signal processing errors.

Alternatively, significant price increases could indicate that your PBM is processing claims conservatively, potentially underdelivering on contractual pricing commitments. Regular pricing reviews during the initial months following go-live help identify issues early. This can prevent large reconciliation adjustments at year-end when the financial impact may be more substantial and complex, especially if the adjustment impacts a member’s out-of-pocket cost.

Consultant Support: Independent Expertise When It Matters Most

Navigating a PBM implementation requires specialized expertise that many organizations may not maintain in-house. PSG is an independent consultant with extensive industry knowledge and established market relationships that provides several critical advantages during this complex process.

How can PSG help your implementation be more successful?

• We have experience from countless implementations with many PBMs. This enables us to better identify potential issues before they become a big problem. We understand the difference between normal transition challenges versus those that require immediate attention.
• Our team has relationships across the PBM marketplace, providing leverage when issues arise and ensuring your concerns receive appropriate attention and resolution. This market influence can be particularly valuable when managing timeline pressures or resolving complex configuration challenges.
• Involvement from a consultant like PSG demonstrates to the PBM that your organization is supported by experienced professionals who understand industry standards and best practices. This sentinel effect often results in more thorough preparation and attention to detail from your PBM team, as they recognize they’re working with informed stakeholders who will identify and address any shortcomings.

PBM Implementations: Details Define Success 

Implementation success ultimately determines whether your carefully negotiated contract delivers its intended value to your organization and members. While the process presents significant challenges, proactive planning and attention to critical success factors substantially improve your likelihood of achieving a smooth transition. The strategies outlined above (adequate timeline planning, thorough customization documentation, comprehensive testing, attentive member feedback monitoring, and expert consultant support) provide a framework for implementation success. To learn more about how our implementation expertise can support your pharmacy benefits strategy, contact our team of specialists for a consultation tailored to your specific needs.

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