What is a PBM?
Pharmacy Benefit Managers (PBMs) are third party administrators for prescription drug programs that negotiate drug prices with manufacturers and handle the exchange of money between pharmacies and health plan enrollees (employees of private companies and government agencies as well as welfare programs). The three largest PBMs are Medco Health Solutions, Express Scripts and CVS Caremark.
What’s bad about PBMs?
PBMs claim to lower drug costs for employers, but rarely do. PBMs hide the real prices of prescription drugs and charge their clients absurd markups for the same medicines.
How do they get away with it?
The lack of transparency in the PBM industry and complex methods used to overcharge for prescription drugs allows them to hide real drug costs from their clients. PBMs typically don’t provide clients with complete, itemized billing statements.
Am I being taken advantage of by a PBM?
Probably–PBMs influence more than 80 percent of prescription drug coverage in the
U.S. and administer drugs to more than 200 million Americans.
What can I do about it?
If you manage an employee benefit plan, ask your broker or PBM representative to provide a detailed explanation of your fee structure. Learn more by reading our blog and reviewing our resource pages. Subscribe to our newsletter for updates.