CPAP Module 25, Section 4: The Annual Review Cycle
MODULE 25: CLINICAL CRITERIA DEVELOPMENT & MAINTENANCE

Section 4: The Annual Review Cycle

Understand the dynamic nature of clinical policy, including how and why criteria are updated based on new evidence, generic drug launches, or shifts in the competitive landscape.

SECTION 25.4

The Annual Review Cycle

From Static Document to Living Guideline: The Science of Keeping Policy Relevant.

25.4.1 The “Why”: Medicine Doesn’t Stand Still, and Neither Can Policy

A clinical prior authorization policy, once created, cannot be etched in stone. To do so would be to fundamentally misunderstand the nature of medicine itself. Medicine is a field of constant, relentless evolution. New drugs are approved, landmark trials overturn decades of established practice, new safety signals emerge, and the economic landscape is perpetually reshaped by patent expirations and competitive negotiations. A clinical policy that is not actively and regularly maintained becomes obsolete. An obsolete policy is not just ineffective; it is dangerous. It can lead to the denial of a new standard-of-care therapy, the inappropriate continuation of a drug later found to be harmful, or the wasteful expenditure of healthcare dollars on an agent that no longer represents the best value.

The annual review cycle is the formal, systematic process that PBMs and health plans use to prevent this policy decay. It is the engine of evidence-based maintenance. This process ensures that every clinical guideline is periodically placed under a microscope and re-evaluated against the most current clinical, safety, and economic data. It is a proactive, rather than a reactive, approach to quality assurance. While some events—like a new black box warning—will trigger an immediate, unscheduled review, the annual cycle ensures that no policy is left to languish. It guarantees that every guideline, from the one governing a high-cost oncology agent to the policy for a common dermatological, is regularly refreshed to reflect the current state of the art in medicine.

For the clinical pharmacist, participating in this cycle is a core function and a significant responsibility. It is your job to be the expert on your assigned drug classes, to stay perpetually abreast of new developments, and to be the agent of change who brings forward the evidence needed to justify a policy update. This requires a unique blend of skills: the diligence of a researcher, the critical eye of a clinical scientist, and the pragmatic thinking of a population health manager. This section will provide a comprehensive roadmap to this dynamic process, deconstructing the various triggers that initiate a review and outlining the step-by-step methodology used to carry it out. Mastering this cycle is essential for any pharmacist who wishes to be a true steward of safe, effective, and affordable medication use on a population scale.

Retail Pharmacist Analogy: The Evolution of Your Clinical Counseling

Think about how your personal counseling “protocol” for a major drug class has evolved throughout your career. Let’s use SGLT2 inhibitors (e.g., Jardiance, Farxiga) as a prime example.

  • Version 1.0 (Initial Launch – c. 2014): Your counseling is focused exclusively on Type 2 Diabetes. You discuss blood sugar control, the mechanism of urinary glucose excretion, and the primary side effects like UTIs and yeast infections. Your mental “policy” is: This is a diabetes drug.
  • Version 2.0 (The EMPA-REG OUTCOME Trial – c. 2015): A landmark trial is published in the NEJM showing a surprising and dramatic reduction in cardiovascular death in patients taking empagliflozin. This is a major “New Landmark Trial” trigger. Your counseling protocol immediately evolves. You now proactively mention to diabetic patients with heart disease that this medication has a powerful heart-protective benefit. Your mental “policy” updates: This is a diabetes drug with a significant CV benefit.
  • Version 3.0 (The DAPA-HF & EMPEROR-Reduced Trials – c. 2019-2020): New trials are published showing these drugs are profoundly effective for Heart Failure with Reduced Ejection Fraction (HFrEF), even in patients without diabetes. This is a “New Indication” trigger. You start seeing prescriptions from cardiologists for non-diabetic patients. Your protocol must be rewritten. You now understand and can explain the drug’s role in cardiac remodeling and fluid management, independent of glucose. Your mental “policy” updates again: This is a diabetes drug AND a foundational heart failure drug.
  • Version 4.0 (The DAPA-CKD & EMPA-KIDNEY Trials – c. 2020-2022): More landmark trials emerge, this time showing a powerful benefit in slowing the progression of Chronic Kidney Disease (CKD), again, even in non-diabetics. This is another “New Indication” trigger. Your counseling expands to include a discussion of kidney protection. You become vigilant about checking renal function and understanding the eGFR cutoffs. Your mental “policy” reaches its current state: This is a foundational medication for managing cardiorenal metabolic syndrome.

This personal, continuous evolution of your clinical knowledge, driven by new evidence and new indications, is the exact microcosm of a PBM’s formal policy review cycle. The PBM’s clinical pharmacists are tasked with monitoring for these same triggers and then systematically updating the official PA guidelines to reflect these new realities, ensuring the entire organization is practicing according to the latest and best evidence.

25.4.2 The Masterclass Deep Dive: Triggers for Policy Review

The policy review process is not random. It is initiated by a series of well-defined internal and external events, or “triggers.” Each trigger carries a different level of urgency and requires a distinct response from the clinical pharmacy team. Understanding these triggers is key to understanding the rhythm and priorities of a managed care clinical department.

Masterclass Table: The Eight Core Triggers of Policy Maintenance

Trigger Event Description & Urgency Level Primary Driver Likely Policy Outcome / Action
1. Scheduled Annual/Biennial Review Urgency: Low (Planned). This is the default, scheduled review of a policy. It is part of the PBM’s operational calendar to ensure every policy is reviewed at a regular interval (typically every 12 to 24 months). Quality & Compliance. This is a proactive measure to prevent policy obsolescence and ensure accreditation standards (e.g., from NCQA or URAC) are met. A full-scale review. The pharmacist will conduct a comprehensive literature search for any new evidence since the last review, re-evaluate step therapy, check for updated professional guidelines, and confirm all criteria are still clinically relevant. This may result in minor tweaks or a complete policy rewrite.
2. New Drug Approval (Pivotal/First-in-Class) Urgency: High (Anticipated). The FDA approves a new molecular entity, often a “blockbuster” or first-in-class drug. PBMs track these drugs for months or years in the pipeline and begin the review process well before the actual approval date. Clinical & Financial Strategy. The PBM must determine the new drug’s place in therapy and establish coverage criteria before it hits the market to manage both clinical appropriateness and budget impact. Creation of a brand-new clinical policy. This involves a full monograph, a presentation to the P&T committee, and a decision on formulary placement (e.g., preferred vs. non-preferred, step therapy requirements). The goal is to have the policy live on or very shortly after the drug’s market launch date.
3. New Generic or Biosimilar Launch Urgency: Immediate (Critical). The patent expires on a major brand-name drug, and one or more generic/biosimilar versions become available. This is one of the most significant events in managed care pharmacy. Cost Management. This is the PBM’s single greatest opportunity to reduce drug spend. The goal is to shift utilization from the high-cost brand to the low-cost generic/biosimilar as quickly and completely as possible. Immediate policy update. The policy will be rewritten to make the new generic/biosimilar the exclusive first-line agent. The brand-name drug will be moved to non-preferred status and will require a documented trial and failure of (or contraindication to) the generic. This is often called a “generic-first” strategy.
4. New Landmark Clinical Trial Publication Urgency: Medium (Clinical). A major, practice-changing clinical trial is published in a top-tier journal (e.g., NEJM, JAMA, The Lancet) that demonstrates a new, significant benefit or risk for an existing drug. Clinical Appropriateness. The policy must be updated to reflect the new standard of care established by the trial. Failure to do so could result in denying medically necessary care. Policy modification. This could involve expanding the list of approved indications, altering the step therapy requirements (e.g., moving a drug up in the treatment algorithm), or adding new safety warnings. The SGLT2 inhibitor example is a perfect case study of this trigger.
5. New FDA Safety Communication or Black Box Warning Urgency: Immediate (Critical). The FDA issues a new MedWatch alert, drug safety communication, or mandates a new Black Box Warning for a medication due to post-marketing surveillance data. Patient Safety. This is a non-negotiable, safety-driven trigger. The PBM has a duty to protect its members from newly identified, significant risks. Immediate policy update. New criteria will be added to screen for the identified risk. This could include adding a new absolute contraindication, requiring documentation of a specific lab value before approval, or adding a warning about a newly discovered drug interaction. This is often done via an expedited review process that bypasses the normal P&T cycle.
6. Update to National Clinical Practice Guidelines Urgency: Medium (Clinical). A major professional society (e.g., American Heart Association, American Diabetes Association, National Comprehensive Cancer Network) releases a major update to its clinical practice guidelines. Standard of Care Alignment. PBMs and health plans strive to ensure their coverage policies are consistent with nationally recognized standards of care. This is important for quality ratings, accreditation, and clinical defensibility. Policy review and potential modification. The pharmacist will perform a gap analysis, comparing the existing policy to the new guideline recommendations. The policy will be updated to align with the new standard, which could mean changing preferred agents, diagnostic criteria, or treatment algorithms.
7. Competitor Formulary or Policy Shift Urgency: Low to Medium (Strategic). The PBM’s market intelligence team reports that a major competitor has made a significant change to their formulary (e.g., signed an exclusive contract for a certain biologic) or has implemented a novel utilization management strategy. Market Competitiveness & Financial Strategy. This trigger is about maintaining a competitive position in the marketplace and evaluating whether a competitor’s strategy could provide a clinical or financial advantage. Internal analysis and review. A clinical pharmacist and a financial analyst will model the potential impact of adopting a similar strategy. This may or may not lead to a policy change, depending on the analysis, but it will almost always trigger a formal discussion.
8. Internal Data Analysis & Reporting Urgency: Low (Operational). The PBM’s data analytics team generates reports on drug utilization, approval/denial rates, and costs. The data may reveal an anomaly, such as a drug’s utilization increasing much faster than expected, or an extremely high denial rate for a specific criterion. Operational Efficiency & Quality Improvement. This is about using the PBM’s own data to identify problems or opportunities for improvement within its own policies. Policy clarification or refinement. If a criterion has a near-100% denial rate, it may be poorly written or operationally unfeasible. The pharmacist will review the criterion to see if it can be clarified. If utilization is unexpectedly high, the policy may be reviewed to see if a loophole exists that needs to be closed.

25.4.3 The Process Masterclass: From Trigger to Implementation

Identifying a trigger is only the first step. The subsequent review process is a structured, multi-disciplinary project with a clinical pharmacist at its core. The following flowchart and detailed breakdown illustrate the end-to-end journey of a typical policy update, from the initial spark of new evidence to the final implementation in the PA review system.

End-to-End Policy Review Workflow

1
Trigger Identification & Dossier Creation
2
Clinical & Economic Evidence Review
3
Draft Policy & P&T Monograph
4
P&T Committee Presentation & Vote
5
Operational Implementation
Step 1: Trigger Identification & Dossier Creation

The process begins when a clinical pharmacist identifies or is assigned a trigger. Their first task is to create a “dossier” or project file. This involves gathering all the necessary preliminary documents: the existing PA policy, the new drug’s package insert, the full text of the landmark trial, the new safety alert, utilization reports, etc. This becomes the central repository for all evidence related to the review.

Step 2: Clinical & Economic Evidence Review

This is the deep analytical phase. The pharmacist performs the critical appraisal of the new evidence as detailed in Section 25.2. Simultaneously, they engage with other departments. They will request a financial analysis from the health economics team to model the budget impact of potential policy changes. They may consult with the contracting team to understand the rebate structure for drugs in the class. The goal is to build a complete 360-degree view of the drug’s clinical efficacy, safety, and financial value proposition.

Step 3: Drafting the Policy & P&T Monograph

The pharmacist synthesizes all their findings into two key documents:
1. The P&T Monograph: A comprehensive, evidence-based report (often 20-50 pages) that details the drug’s pharmacology, clinical trial data, safety profile, and economic considerations. It concludes with a series of specific, actionable recommendations for the P&T committee.
2. The Draft Policy: A “red-lined” version of the clinical policy that shows the exact proposed changes. This translates the high-level recommendations from the monograph into the precise, operational language required for a functional guideline, using the principles from Section 25.3.

Step 4: P&T Committee Presentation & Vote

The Pharmacy & Therapeutics committee, a formal body of physicians, pharmacists, and sometimes external experts, convenes (often quarterly) to review and vote on policy changes. The clinical pharmacist who authored the monograph presents their findings to the committee. This is a formal, high-stakes presentation. The pharmacist must be prepared to defend their analysis, explain complex clinical data in a simple way, and answer challenging questions from the committee members. The committee then debates the recommendations and votes to approve, deny, or modify the proposed policy changes.

Step 5: Operational Implementation

Once the P&T committee approves the changes, the work is not done. The updated policy must be officially published and communicated. The clinical pharmacist then partners with the IT and operations teams to translate the updated policy into the PA software system. They will help build the new decision trees, test the logic, and train the review staff on the new criteria. The process is only complete when the updated policy is live and being actively used by the frontline teams.