PBM solutions will save $654 billion over 10 years

Pharmacy benefit manager solutions will save $654 billion over 10 years

The solutions that pharmacy benefit managers use in the marketplace will save health plan sponsors and consumers approximately $654 billion over ten years, according a Visante research.

The savings break down into three categories:

  • Commercial plan sponsors and their members will save nearly $350 billion
  • Medicare Part D and its beneficiaries, nearly $257 billion
  • Managed Medicaid plans, nearly $48 billion 

PBMs offer several solutions to reduce prescription drug costs and improve the quality of pharmacy benefits.

PBMs negotiate rebates from manufacturers of brand drugs that compete with therapeutically similar brands and generics. Manufacturers typically provide a rebate if their product is “preferred,” which means it is assigned a copay lower than competing products.

PBMs negotiate discounts from drugstores: Retail pharmacies provide discounts to be included in a plan’s pharmacy network. The more selective the network, the greater the discount, since each pharmacy will gain business.


Mail-service and specialty pharmacy channels typically give plan sponsors deeper discounts than do retail pharmacies. These channels also help encourage the use of preferred products for additional savings.

PBMs use several tools to encourage the use of generic drugs and preferred brands. These include: formularies and tiered cost sharing, prior authorization and step therapy protocols, generic incentives, consumer education, and physician outreach. As PBMs and plan sponsors strive for greater savings, drug mix becomes even more important.


Plans decide how much PBM Solutions they want to apply when they hire a pharmacy benefit manager

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