Module 6

Question 1

A type of prescription drug benefit plan embedded in a major medical plan where the participant paid in full and then, filed a claim for reimbursement

Answer 1

Prior generation of prescription drug plans

Question 2

A type of prescription drug plan that is typically administered by a pharmacy benefit manager or a third-party administrator apart from the medical plan

Answer 2

Carve-out plan

Question 3

The price of a drug assigned by the drug manufacturer and used as a reference price for all discounts paid to pharmacies and pharmacy benefit managers

Answer 3

Average wholesale price (AWP)

Question 4

The price of a drug at which wholesalers buy pharmaceuticals from manufacturers

Answer 4

Wholesale acquisition cost (WAC)

Question 5

Set by the Medicaid program, this is the upper price limit for all generic medications

Answer 5

Maximum allowable cost (MAC)

Question 6

A predetermined amount a participant pays when a prescription is filled

Answer 6

Copay

Question 7

A special classification of medications not covered by a plan

Answer 7

Exclusions

Question 8

Prescription products that don’t cure illness, but improve daily life by enhancing psychological attitudes, energy levels, sexual performance, or body image.

Answer 8

Lifestyle drugs

Question 9

Types of medications that do not require a prescription and can simply be purchased at the drug store.

Answer 9

Over the counter (OTC) drugs

Question 10

Drugs made from living cells that treat various diseases.

Answer 10

Biotechnology medications

Question 11

A type of drug utilization program for educating physicians about drugs or drug therapies

Answer 11

Prospective review

Question 12

A list of drugs preferred by a health plan/ pharmacy benefits manager

Answer 12

Formulary

Question 13

A program that restricts coverage for certain drugs based on the patient’s conditions and maximizes the outcome of the medication. The physician must call in to the plan administrator.

Answer 13

Prior authorization

Question 14

A predefined maximum quantity for specific medications that restricts the number of dosage units. It may be used to prevent abuse or overuse of the medication.

Answer 14

Quantity limits

Question 15

A drug utilization program that occurs at the point of service and flags potential overuse based on clinical monitoring criteria or ‘edits’ programmed into the pharmacy benefit manager’s system.

Answer 15

Concurrent review

Question 16

A drug utilization program that requires the pharmacist or nurse to review the patient profile to determine if they are complying with drug therapy or to suggest alternative therapies.

Answer 16

Retrospective review

Question 17

A type of formulary that allows plan enrollees to have any covered prescription drugs prescribed for them

Answer 17

Open formulary

Question 18

A type of formulary that encourages the use of certain drugs in return for a reduced payment

Answer 18

Preferred formulary

Question 19

A type of formulary where the plan will not cover a non-formulary drug

Answer 19

Closed formulary

Question 20

A program that measures/manages all healthcare outcomes and costs associated with a particular disease across the entire continuum of healthcare delivery.

Answer 20

Disease state management program

Question 21

A type of disease state management program that uses call centers staffed by nurses to triage patients with select diseases to appropriate levels of care and to follow up with them

Answer 21

Medical model

Question 22

A type of disease state management program administered by PBMs, pharmaceutical manufacturers, or health plans to improve compliance with medication therapy, educate patients, and test outcomes.

Answer 22

Therapy-directed model

Question 23

An approach to medical decision making that emphasizes scientific evidence and statistical methods for evaluating outcomes and risk of treatments.

Answer 23

Evidence-based medicine

Question 24

An entity that administers managed pharmacy programs through application of programs, services, and techniques designed to control costs.

Answer 24

Pharmacy benefit manager (PBM)

Question 25

An agreement between a pharmacy benefit manager and a drug manufacturer to secure significant reductions in the cost of prescription drugs.

Answer 25

Rebate