PQM FAQs

Pharmacy Quality Management ® – All Programs 
PQM General Questions – Applying for Accreditation
PQM General Questions – Accreditation Benefits to Consumers
PQM General Questions – Accreditation Benefits to Purchasers
PQM General Questions – Areas of Interest for Regulators
PQM General Questions – Accreditation Contract Agreement
PQM General Questions – Clinical Rigor
PQM General Questions – Organizations’ Content Information Level
PQM General Questions – Regulatory Compliance
PHARM Core – All Programs
Pharmacy Benefit Management (PBM)
Drug Therapy Management (DTM), v2.0
Pharmacy Benefit Management (PBM) and Drug Therapy Management (DTM)
Mail Service Pharmacy and Specialty Pharmacy
MEASURES: Pharmacy Quality Management - PBM AND DTM

PQM  General Questions – Accreditation Benefits
Question: Why is URAC’s Pharmacy Quality Management® Accreditation a good idea?

Response: The lion’s share of insured Americans receive PBM services, yet URAC’s accreditation program is the first to give comprehensive, third-party assurance for consumers and purchasers that quality standards were met for consumer protection and empowerment, appropriate access to drugs and pharmacies, patient safety, and disclosure of pricing and contracting terms

• In 2005 alone, Americans spent more than $170 billion for prescriptions at retail pharmacies.  This staggering dollar figure represents more than 3.1 billion individual retail prescriptions filled or re-filled—and doesn’t include some 244 million prescriptions filled via mail order pharmacy.  
• Some 70 percent of those prescription drug transactions were managed by a prescription benefit management (PBM) program. 
• Pharmacy related expenses in the United States were expected to reach $250 billion in 2006, representing an 11.5 percent increase over 2005.  
• The sector saw rapid expansion with the introduction of Medicare Part D prescription drug coverage in 2006, with more than 39 million Medicare beneficiaries (90 percent) now enrolled in that program.

The need for additional consumer protection and safety guidelines is an area of concern for many. The final rule implementing the Medicare Modernization Act of 2003 (MMA) included specific language addressing some of the key issues surrounding PBM practices, and included an invitation from the Centers for Medicare and Medicaid Services (CMS) for industry self-regulation. The regulation recognizes third party accreditation programs to create recognition for:

• Access to covered Part D drugs including the pharmacy access requirements and the use of standardized technology and formulary requirements;
• Drug utilization management, Quality Assurance, Medication Therapy Management, and a program to control fraud, waste and abuse; and
• Confidentiality and accuracy of enrollee records.

URAC’s new Pharmacy Benefit Management Accreditation addresses many of these concerns.

Question: In what ways do Pharmacy Quality Management ® organizations benefit from URAC accreditation?

Response: The standards support creation and maintenance of a quality management framework, or a template for policies and procedures that address:

• Ongoing management of quality procedures, including a quality committee, following a logical blueprint for quality management, maintenance and reporting. 
• Development and maintenance of written policies and procedures
• Staff qualifications, credentialing, and oversight requirements of qualified staff for certain functions
• Development, delivery and expectations of drug utilization management programs
• Scope of appeals considerations, or procedures in place for how an appeals process works.
• URAC educational support and training to assist with adherence to standards

PQM General Questions – Applying for Accreditation
Question: Who can apply for URAC’s Pharmacy Quality Management ® accreditation program?

Response: Health plans offering these services or standalone pharmacy organizations may apply.

Question: How can organizations apply for Pharmacy Quality Management ® accreditation?

Response: Call URAC at (202) 216-9010.  For more information about the accreditation process, go to http://www.urac.org/healthcare/accreditation.
"Total Number of Retail Prescription Drugs Filled at Pharmacies, 2005." State Health Facts. 2006. Kaiser Family Foundation. 29 Sep 2006 <http://statehealthfacts.org/cgibin/healthfacts.cgi?action=compare&category=Health+Costs+%26+
Budgets&subcategory=Prescription+Drugs&topic=Total+Retail+Rx+Drugs>.
Pharmacy Benefit Management Market Overview 2006.  April 2006.

PQM General Questions – Accreditation Benefits to Consumers
Question: How do URAC’s Pharmacy Quality Management ® Accreditation standards benefit consumers?

Response: The standards require organizations have policies and procedures in place that ensure:

• Access to appropriate drugs/medications
• Protection of health information
• Customer service center operations and performance standards, such as timeliness and performance in answering telephone inquiries, or reasonable and accessible hours or operation.
• Complaint and appeals tracking and resolution
• Drug safety issues identification, resolution, and informing consumers promptly.  For instance, the standards examine policies and procedures that govern pharmacy networks and how they ensure drug safety protocols at the pharmacy level—issues such as drug interactions, whether a drug is appropriate for the consumer’s age and gender, or whether there are drug alerts that apply.
• Accessibility and reliability of information intended for consumers, such as availability of provider directories or information about formularies and benefit coverage.
• Methods to measure customer satisfaction
• Access, availability, and quality and safety criteria in the pharmacy network (including any way drugs are distributed, such as retail and specialty clinics).

PQM General Questions – Accreditation Benefits to Purchasers
Question: How do URAC’s Pharmacy Quality Management ® Accreditation standards help purchasers? 

Response: Since purchasers seek PBM services on behalf of consumers, many of the same benefits apply.  In addition to those listed above, the standards require organizations have policies and procedures in place that ensure:

• Data integrity security, so purchasers know health and personal information about the employees is safe.
• Disclosure and verification of contractual policies, such as how payment policies with drug manufacturers were developed;
• Disclosure of what audit rights clients have to ensure pricing methodologies remain transparent.
• Integrity of the formulary development process.  These include standards surrounding the way drugs are selected for inclusion in formularies, such as the qualifications of those making decisions and that considerations about safety and effectiveness come before cost. 
• Operational requirements and performance standards, such as licensure and certification of staff.

PQM General Questions – Areas of Interest for Regulators
Question: In what ways will Pharmacy Quality Management ® accreditation address areas of interest for regulators?

Response: The standards require organizations have policies and procedures in place such as:

• Conflict of interest requirements—for staff, committees, or others connected to the organization.  For example, members of a pharmacy and therapeutics or formulary committee cannot have relationships with a drug manufacturer with a product under consideration.   
• Safeguards to ensure that financial incentives do not create conflicts of interest.
• Access to drugs and services needed by consumers.
• Regulatory compliance such as licensure of staff and facilities.

PQM General Questions – Accreditation Contract Agreement
Question: How do URAC’s Pharmacy Quality Management ® accreditation standards address clarity in contracting agreements?

Response: The standards require organizations have policies and procedures in place for the purchaser that ensure:

• Disclosure of rebate structure
• Disclosure and definition of pricing structure
• Audit arrangements
• Formulary decision making

PQM General Questions – Clinical Rigor
Question: How do URAC’s accreditation standards assure clinical rigor in its Pharmacy Quality Management ® programs?

Response: The standards require organizations have policies and procedures in place that ensure:

• Clinical decisions and information are developed and delivered with the involvement and oversight of appropriate clinicians to promote optimal and cost effective drug use. 
• Clinical decisions and information are developed through an evidence-based process.
• Clinical information undergoes timely review and updates.
• The Pharmacy and Therapeutics Committee and formulary development and management process is based on efficacy, safety, and therapeutic need.

PQM General Questions – Organizations’ Content Information Level
Question: Are organizations required to have the content of information at a specific grade-level?

Response: URAC will not specify that consumer content be developed for a sixth-grade (or any) reading level.  However, URAC will ask the organization to state what reading level it targets, the criteria it uses to test content against that reading level, and how it ensures that consumer content meets those criteria. Refer to the Health Literacy Communication Requirements and Consumer Education sections for additional information.


PQM General Questions – Regulatory Compliance
Question: Is an organization required to meet state and federal laws if it is not noted in the standards and/or interpretive information/commentary section?

Response: State and federal laws supersede URAC Standards if the laws or regulations are more rigorous than URAC Standards. Conversely, an applicant must comply with URAC Standards if the standards are more stringent. If an applicant is required by law to carry out its business in a manner not consistent with URAC Standards, then the applicant may request a variance from a URAC Standard. A copy of the relevant statute or regulation must accompany the request submitted for that standard in the application.

PHARM Core – All Programs

Standard Module: PHARM Core
Module Version: All
Standard Number: PHARM Core
Standard: PHARM Core Module

Question: Is PHARM Core included in all pharmacy programs?

Response: Yes. Each pharmacy-related accreditation will include PHARM Core and the module(s) covering the functions

Standard Module: PHARM Core
Module Version: 3.0
Standard Number: PHARM Core 41
Standard: Employment Background Screening

Question: Do all employees of a pharmacy organization have to undergo employment background screening?

Response: No. This mandatory standard requiring criminal background checks and drug testing/screening applies to the organization’s employees who handle, may come in contact with, or have access to all medications and controlled substances, and /or who have access to or may come in contact with, health information and personal information of consumer/claimants receiving benefits.

Pharmacy Benefit Management (PBM)

PBM General Questions – PBM Organization Function
Question: What do pharmacy benefit management (PBM) organizations do?

Response: Pharmacy benefit management organizations work like a health plan for drugs/medications.  They manage drug benefits on behalf of employers, negotiating preferred pricing for drugs, determining pharmacy networks, and developing and maintaining a “formulary”—the list of covered or preferred medications--with the goal of helping purchasers reduce costs.  They can either work in partnership with a health plan to provide services, or can work as a stand-alone service.  Employers use these services to lower costs because the cost of pharmaceuticals represents more than 12 percent of total health spending, a significant proportion of their total health expenditure.


Drug Therapy Management (DTM), v2.0

Standard Module: Drug Therapy Management (DTM)
Module Version: 2.0
Standard Number: DTM 7
Standard: Periodic Consumer Reassessment Process

Question: Under this new standard, how often does the organization have to reassess the participating consumers?

Response: The URAC standard is not prescriptive regarding the frequency with which consumer reassessments are conducted. The organization should specify appropriate, specific timeframes for reassessments in its policies and procedures for this process.

Standard Module: Drug Therapy Management (DTM)
Module Version: 2.0
Standard Number: DTM 21, 22 and 23.
Standard: Program Evaluation: DTM 21 – Process, DTM 22 – Outcome, and DTM 23 – Methodology Disclosure

Question: Since the evaluation of the program is a key focus of these new standards, what is expected by an organization?

Response: An organization should have a mechanism for evaluating the success of its program offered. This evaluation includes the assessment of clinical/health related benefits financial benefits, and the impact of a specified program. The program evaluation benefits (outcomes) must be reported to current and prospective purchasers/clients, and the evaluation methodology used to determine the program evaluation must also be disclosed.

Pharmacy Benefit Management (PBM) and Drug Therapy Management (DTM)

Standard Module: Pharmacy Benefit Management (PBM) and Drug Therapy Management
Module Version: 1.0 and 2.0
Standard Number: All
Standard: Pharmacy Operations Module

Question: Does URAC expect PBMs and DTMs to meet the standards in the Pharmacy Operations’ Module?

Response: No. The Pharmacy Operations’ Module is applicable for mail service and specialty pharmacy programs.

Standard Module: Pharmacy Benefit Management (PBM) and Drug Therapy Management
Module Version: 2.0
Standard Number: CSCD 5 and DTM 14
Standard: Integration with Existing Benefits

Question: Is an organization required to integrate its program existing benefits with its clients’ benefit structures?

Response: No. The organization should be aware of the existing health programs and benefits of purchasers/clients. Those benefits and programs to be coordinated would include but not limited to other health plan carriers, pharmacy benefit managers, third party administrators, disease management vendors, etc.  If an organization is asked to coordinate its program into the current benefit structure, it will also be necessary to coordinate materials and communications between the organization and those other existing programs. It is the purchaser’s responsibility to inform the organization of its benefit structure and request the organization coordinate its offering within that structure.

Mail Service Pharmacy and Specialty Pharmacy

Standard Module: Mail Service and Specialty Pharmacy
Module Version: 1.0
Standard Number: All
Standard: P&T Committee
Question: Is a P&T Committee required for mail service and specialty pharmacy programs?

Response: If the pharmacy contracts directly with health plans and other payers without the benefits of P&T Committee recommendations, and have a preferred drug list or formulary, the pharmacy must disclose the drug list and define its clinical oversight process to clients.

Standard Module: Pharmacy Benefit Management (PBM)
Module Version: 2.0
Standard Number: CSCD 6 and DTM 15
Standard: Coordination of Communications

Question: Is an organization required to coordinate its communications with its clients’ health and service offerings?

Response: No. The organization should ensure that the various communications received by consumers from different sources do not conflict with one another.  Examples of such communications include but not limited to educational materials, information, resources, and other communications that are available to consumers.  If an organization is asked to coordinate its program into the current benefit structure, it will also be necessary to coordinate materials and communications between the organization and those other existing programs. It is the purchaser’s responsibility to inform the organization of its benefit structure and request the organization coordinate its offering within that structure.

Standard Module: Pharmacy Benefit Management (PBM)
Module Version: 2.0
Standard Number: CSCD 7 and CSCD 8
Standard: CSCD 7 – Disclosure and CSCD 8 – Disclosure Verification

Question: What has been revised in version 2.0 regarding these standards that address disclosure of information to clients?

Response: These standards and elements are now mandatory, based on the new scoring methodology. The standards addresses disclosure of potential conflicts of interest, sources of revenue, pricing structure, and delegation/subcontracting. The organization allows its client to verify such disclosures.

Standard Module: Pharmacy Benefit Management (PBM)
Module Version: 2.0
Standard Number: CSCD 14
Standard: Electronic Prescribing

Question: What is required by a pharmacy organization regarding electronic prescribing?

Response: The new standard for electronic prescribing is a mandatory standard that requires the organization to use a system for electronic prescribing, which can be integrated with its drug management systems and complies with NCPDP standard transactions. The electronic prescribing system may include but not limited to information on formularies, benefits, medication history, and prescription fill status.

Standard Module: Pharmacy Benefit Management (PBM)
Module Version: 2.0
Standard Number: PHARM-DC 9
Standard: Distribution Channel Management

Question: Is the PBM expected to verify the credentials of all pharmacies in its network?

Response: Yes. With this new mandatory standard, an organization is required to have a policy and/or documented procedure for verifying its network pharmacy’s credentials. The verification must include facility state licensure, DEA registration, and professional liability insurance. The organization must also verify the determination of the absence of government debarment and the ability to transmit transactions electronically.

MEASURES: Pharmacy Quality Management - PBM and DTM
Version 2.0

Question: When is an organization required to report the performance measures?

Response: The measurement reporting period is the calendar year. An organization’s first measurement year is the year following its accreditation under PBM and DTM Accreditation, version 2.0 or higher. Organizations must report the mandatory performance measures to URAC by April 30 of the year following the measurement period. For example, if an organization received DTM accreditation in 2010, its first measurement reporting period is 2011, and measures are due to URAC by April 30, 2012.

Question: What are leading measures?

Response: Measures are designated as “leading” when there does not yet exist an industry standard for measuring the concept of interest. While a measure is categorized as leading, URAC will continue to gather input from the field about how the concept should be measured. In future versions of the measures, leading measures may become mandatory as consensus builds on how the measure should be specified. While organizations are not required to report leading measures, URAC strongly encourages them to, as having more data on these measures will help us assist the industry in developing standardized ways to measure performance.

Question: Once my organization has been accredited under PBM and/or DTM version 2.0 or higher, how often do we need to report the performance measures to URAC?

Response: Accredited organizations must report the mandatory measures annually.

Question: My organization is currently accredited under PBM and/or DTM version 2.0 or higher, do we need to report the measures?

Response: No, only organizations that have been accredited under PBM and/or DTM version 2.0 or higher are required to report the mandatory measures to URAC.

Question: My organization has both PBM and DTM accreditation; do we need to report all measures separately for each product?

Response: Yes. If an organization has accreditation for PBM and DTM, version 2.0 or higher, it will need to report all measures separately for each product.

Question: How will an organization report measures to URAC?

Response: Reporting templates will be available to accredited organizations through the AccreditNet platform. Detailed instructions for collecting and reporting the data will be provided.

Question: Will the new measures be publicly reported right away?

Response: The measures will be phased in as follows:

1. Phase 1: Measures reported to URAC; focus on internal quality improvement
2. Phase 2: Mandatory measures subject to external auditing/verification process; de-identified aggregate reports publicly available
3. Phase 3: Audited measures included in unblinded public reporting formats on the URAC Website

Each phase will be at least one year long. Numerators and denominators for the rates will never be reported publicly; they are requested only for URAC’s internal analyses.