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Wrangling Your PBM Costs

Written by Jennifer Stuart—Employee Benefits Advisor

November 11, 2024 · 2 min minute read

Blog Wrangling Your PBM Costs

If your organization is with one of the Big Three pharmacy benefit managers (PBMs)—Express Scripts/ESI, CVS/Caremark, or OptumRx—you’re likely paying more for your prescription drug coverage than you should. Traditional PBM agreements allow maximum allowable cost lists, spread pricing, and rebate-chasing. These tactics and many others end up costing you, and your employees, a lot of money.

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Switching to a transparent PBM model within these big three PBMs may eliminate some of these issues, but not all of them. Often, they promote a “pass-through” arrangement wherein you get to keep a portion of the rebates generated. But this is not transparency.

To achieve transparency and real cost control, employers must move to a genuinely transparent model with a PBM that is not one of the Big Three.

Transparent PBM pricing accomplishes many things, including:  

  • Elimination of Spread Pricing. Pay only a per-employee, per-month fee and/or a per-transaction fee.
  • Improved Drug List. Your formulary (drug list) can be based on low-cost, high-efficacy medications instead of chasing rebates.
  • Complete Rebates. All rebates are passed through, not just a portion. With a transparent PBM, the medication with the lowest net cost is promoted, whether a non-rebate-generating medicine with a low price point or a higher-cost medicine that, once the rebate is incurred, has a lower overall cost.
  • Capture Manufacturer Coupons. These coupons offset the amount employees pay for the prescription. In traditional models, that information is not captured, so a member could meet their out of pocket max on paper, but not have actually paid it. Transparent PBM contracts allow you to track this information toward member accumulators.
  • Maximize Alternate Funding For High-Dollar Specialty Medications. Specialty medications are one of the biggest cost drivers employers face today, with multiple million dollar drugs on the market. Alternate funding allows a way for employees to obtain their medication free of charge, while also saving the employer money. It's a win-win!

 

Switching to a genuinely transparent PBM can significantly lower prescription drug costs and improve employer cost control. Transparent PBMs eliminate spread pricing, pass through all rebates, and use alternate funding to reduce costs. This ensures that organizations save money while providing employees with life-saving and cost-effective prescription coverage.

Have questions? Contact:

Jennifer Stuart

Jennifer Stuart

Employee Benefits Advisor

Call: (903) 716-5916
Book an Appointment»

Years of experience

19

I’ve spent my career immersed in the world of sales, service, and insurance, building a reputation as a change agent in the employee benefits space. My journey started in customer-facing roles, from managing retail stores to account management at Delta Dental, where I quickly realized the limitations of traditional approaches to insurance. Transitioning to brokerage, I honed my skills in self-funded health plans and innovative cost-control strategies. Over the years, I’ve grown businesses from the ground up, managed multimillion-dollar books of business, and helped clients navigate the complexities of healthcare with a proactive, data-driven approach. Today, as a producer with Leavitt Group, I’m passionate about aligning employer and employee goals to create sustainable, cost-effective benefits programs that add measurable value.

What sets me apart is my commitment to disrupting the status quo. While many brokers focus solely on minimizing renewal increases, I dig deeper—seeking alignment of interests, educating employees, and exploring creative funding options that benefit everyone involved. I believe in putting people first, whether that means breaking down complex policy language for better understanding or ensuring that cost-saving measures don’t come at the employee’s expense. My approach is rooted in integrity, innovation, and a relentless drive to find better solutions for my clients. With professional designations like Group Benefits Advisor (GBA) and a soon-to-be Certified Pharmacy Benefits Specialist (CPBS), I stay on the cutting edge of industry advancements, always striving to make a meaningful impact.

When I’m not diving into data or strategizing with clients, I’m a proud wife and mom to two children. We love traveling to experience new cultures, attending Astros games, and cheering at local soccer and football matches. An avid reader and art enthusiast, I find joy in history, philosophy, and drawing. Whether enjoying a meal at Pappas Seafood or spending time with family, I embrace the vibrant community around me. With roots in Rogers, Arkansas, and a career spanning Little Rock to Austin, I bring a blend of hometown values and big-picture thinking to every endeavor.

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