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Is It Time You Reconsidered Your Pharmacy Benefit Manager?

Marc Lasceski June 14, 2018

As open enrollment time approaches each year, companies have to look at every aspect of their benefits package in order to manage rising costs while still offering their employees attractive options. One part of the package that’s getting more and more attention is Pharmacy cost and the role of the Pharmacy Benefit Manager (PBM).

PBMs originated as middlemen to process prescription drug claims for benefit plan sponsors. As the industry grew, so did concerns and questions about PBMs’ growing power and profits. Today, as a result of acquisitions and mergers, three PBMs control about 80 percent of the prescription drug market: CVS Caremark, Express Scripts and Optum Rx.

How does this affect prescription benefit plans, pharmacies and patients?

Fueling the overall healthcare cost increase, PMBs often assure that costs continue to climb by reducing competition and blocking access to complete information. Employers feel helpless and frustrated about rising prescription costs and their lack of control. Complicated contracts and limited knowledge about formularies and rebates create confusion. Plan providers and patients can’t see how they benefit, or how PBMs profit, from contracts, formularies and rebates. The lack of transparency shades information about what PBMs receive in fees, rebates, discounts and supplier agreements.


  • High approval rates of specialty drugs drive high rebates to the PBM when patients may not need specialty drugs.
  • PBMs dispense rebates based on the estimated rebate the customer would receive if negotiating with the drug manufacturer vs. what the PBM actually receives.
  • Since pharmacy fees are based on the drug price, it’s in the best interests of the PBM to keep prices high.
  • PBMs make higher payments to their own prescription-filling outlets.
  • PBMs may favor more expensive medications on their formularies because they receive higher rebates on them.

Is there a better way?  The Oswald Difference.

A transformative approach to prescription drug benefits that focuses on honesty, efficiency and cost savings, Oswald Rx is a full-service pharmacy benefits program that manages drug benefits to the advantage of employers and their employees. With no direct ties to drug manufacturers or pharmacies, we have only the best interest of your company and your most valuable resource—your people—to drive us. We would love to evaluate your benefits package to see how this could give you the upper hand in navigating escalating pharmacy costs. Please contact our Employee Benefits team to learn more.

Marc LasceskiMarc Lasceski
Senior Employee Benefits Consultant

Connect with Marc on LinkedIn.

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Note: This communication is for informational purposes only. Although every reasonable effort is made to present current and accurate information, Oswald makes no guarantees of any kind and cannot be held liable for any outdated or incorrect information. View our communications policy.