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November 4, 2022

Pharmacy benefit managers

What are they and how can they help you?

It’s not unusual for the average consumer to conflate pharmacy benefits with health care benefits. That’s understandable given the similarities the two share from the end-consumer's perspective. But from an employer’s perspective, the two couldn’t be more different to manage. The current pharmacy space can be overwhelming. There are notable increases in both the number of medications prescribed and the prices of the medications themselves, not to mention continuous negotiations between manufacturers and Pharmacy Benefit Managers (PBMs). 

What are pharmacy benefits managers?

Just as you have a consultant for health benefits, PBMs are the administrators of the pharmacy world. They are the silent but critical part of the team that works closely between the employer, the manufacturers, and the pharmacies to determine:

  • Prescriptions available
  • Prices from the manufacturer
  • What pharmacies to use
  • Claim and payment processes

Is a PBM right for you?

PBMs typically work with larger companies and their contracts can often include complex language that an expert should review. If you’re reviewing your PBM contract, areas you may want to focus on include:

  • Rebates: when and how they are earned
  • Definitions of generic drugs
  • Guarantees included and excluded
  • Eligible claims
  • Access to resources and data

It’s okay to shop around for a PBM just like you would for a realtor, consultant, or doctor. They provide a service to you and the relationship should benefit your company. Trust, integrity, and respect are vital attributes of a PBM. 

Now what?

You’ve decided to move forward with a PBM, and you’ve negotiated a contract, but what happens now?

  1. Decide how you will use the data that is available to you from your PBM.
  2. Design a program that optimizes the use of cost-effective drugs for both the employer’s and members’ benefit.
  3. Pursue a prescription assistance program (PAP).
  4. Consider drug importation.
  5. Research risk mitigation for high-cost specialty medications.

Pharmacy benefits can be too complex for many companies to navigate without a team of knowledgeable partners. Our consultants at MMA Rx Solutions take a holistic approach to pharmacy management. Using our data-driven solutions and ongoing program management, we help employers navigate the pharmacy benefits space to identify creative cost saving solutions. Reach out to your local consultant today to see how we can help you find better solutions to manage your pharmacy benefits.

Estimate your savings with MMA RxSolutions now.

This document is not intended to be taken as advice regarding any individual situation and should not be relied upon as such. Marsh & McLennan Agency LLC shall have no obligation to update this publication and shall have no liability to you or any other party arising out of this publication or any matter contained herein. Any statements concerning actuarial, tax, accounting or legal matters are based solely on our experience as consultants and are not to be relied upon as actuarial, accounting, tax or legal advice, for which you should consult your own professional advisors. Any modeling analytics or projections are subject to inherent uncertainty and the analysis could be materially affected if any underlying assumptions, conditions, information or factors are inaccurate or incomplete or should change. Copyright © 2022 Marsh & McLennan Insurance Agency LLC. All rights reserved. CA Insurance Lic: 0H18131.