The new-age PBM - by Nikhil Kapse - Nikhil's Insights

Disclaimer: This is a sequel to the last article I wrote, so I strongly recommend reading that one before this so you have the necessary context on PBMs, cash-pay networks, online pharmacies, and the cost-plus model. I’ve spent the last month exploring innovative cost-containment models in pharmacy, and in this article, I’ll try to assemble those ideas into a coherent benefit design that saves both plan sponsors and members money. But before we discuss alternatives, we need to understand the context behind the status quo. The entity that is currently primarily responsible for the pharmacy component of a health plan is the pharmacy benefit manager (PBM), and to meaningfully discuss what a new benefit model would need to look like, we should first revisit why PBMs exist in the first place. Reducing—or at least stabilizing—cost is supposed to be the PBM’s primary function. The same way health insurance networks are supposed to create discounts for medical services, PBMs are supposed to en

Disclaimer: This is a sequel to the last article I wrote, so I strongly recommend reading that one before this so you have the necessary context on PBMs, cash-pay networks, online pharmacies, and the cost-plus model. I’ve spent the last month exploring innovative cost-containment models in pharmacy, and in this article, I’ll try to assemble those ideas into a coherent benefit design that saves both plan sponsors and members money. But before we discuss alternatives, we need to understand the context behind the status quo. The entity that is currently primarily responsible for the pharmacy comp