At US-Rx Care, we believe that healthcare should work for those who fund it and those who rely on it—not the middlemen. As pharmacy costs spiral and traditional PBM models continue to fall short, health plans have a powerful opportunity: to take the lead in reshaping the future of pharmacy benefits.
The landscape is changing. Now is the moment for bold decisions, clear accountability, and smarter pharmacy benefit strategies that put members and plan sponsors first.
Pharmacy Benefits at a Crossroads
Health plans are facing increasing pressure to rein in prescription costs while delivering better outcomes. But the playbook has changed. Here are four key trends defining the future of PBMs—and why health plans are best positioned to drive meaningful change:
Transparency Isn’t a Perk. It’s a Requirement
Gone are the days of complex contracts and black-box pricing. Today’s employers and plan sponsors demand clarity—and they deserve it. Traditional PBMs often profit from hidden markups, retained rebates, and misaligned incentives. That model is outdated and unsustainable.
Specialty Medications Are Reshaping the Cost Curve
Specialty drugs make up a small fraction of prescriptions—but they dominate total spend. Plans need more than discounts. They need clinical oversight, formulary integrity, and precision strategies that ensure the plan and plan members’ interest are placed above the PBM’s.
Data Is the New Advantage
Advanced analytics are powering a new era of proactive pharmacy management. From identifying savings opportunities to reducing waste and improving adherence, data is helping health plans move from reactive to strategic.
A Fiduciary PBM Built to Serve Plans, Not Profits
US-Rx Care was founded on one guiding principle: to be a true fiduciary partner. That means no hidden revenue, no conflicts of interest, and no games with the data. Just measurable results and total alignment with the plan sponsor’s own fiduciary role.
Here’s how our model is different—and why it matters to your plan:
Flat-Fee Contracting: Transparent pricing with no hidden revenue streams or incentives.
Zero Conflicts of Interest: We don’t retain rebates, manipulate formularies, or profit from your drug spend.
Clinically Driven Optimization: Every decision we make is rooted in clinical integrity and long-term member health—not margin.
Savings That Stick: Our fiduciary model consistently reduces total pharmacy spend by 30–50%, without compromising care or access.
With US-Rx Care, you’re not just outsourcing a service—you’re gaining a fiduciary partner who shares your mission and puts your plan and plan members first, always.
Leading from the Front
Pharmacy benefit reform won’t come from the status quo. It starts with forward-thinking health plans willing to challenge conventional models and demand better for their members. The future belongs to those who take control—who ask the tough questions, push for true transparency, and demand that every dollar delivers value.
At US-Rx Care, we’re here to help you lead that charge.
If you’re ready to break away from outdated PBM models and build a pharmacy strategy that works for your members, your mission, and your margins—let’s talk fiduciary.
“Operating with a true risk management focus and always in the best interests of the client is very liberating for health plans and employers in terms of the strategies we can provide to benefit plan sponsors and participants…we believe that the fiduciary mindset offers a valuable roadmap for what every organization should expect from all vendors, including their PBM and health plan carriers.”
-Renzo Luzzatti, President, US-Rx Care
It’s true—when facing the realities of just how expensive pharmacy benefits have become, more and more groups are realizing that the traditional PBM model just isn’t working in their favor. For those looking for both savings, integrity, and compliance, the fiduciary model has proven to be nothing short of game changer.
An ‘F’ Word that Packs a Punch
In the health benefits space, the term “fiduciary” carries some serious weight. Under the Employee Retirement Income Security Act of 1974 (ERISA), a fiduciary is defined as “any person or entity that exercises, administers, or advises discretionary control over plan management and assets.” And this comes with a crucial legal obligation: to act solely in the best interests of the plan and its participants.
In simpler terms, a fiduciary PBM must:
Prioritize the plan and its members above all else
Avoid all conflicts of interest, including third-party incentives
Disclose all financial arrangements
Provide total transparency on costs and utilization
Unlike traditional PBMs that often profit from opaque deals, rebates, and spread pricing, a fiduciary PBM removes these hidden profit centers entirely. This level of transparency enables better decision-making and ensures that cost-saving strategies aren’t just smoke and mirrors—they’re real, measurable, and aligned with your best interests.
Results That Speak for Themselves
Groups who move to a fiduciary PBM model—like US-Rx Care—often experience immediate and significant cost reductions by:
Eliminating wasteful spending
Optimizing drug utilization
Getting back 100% of negotiated savings to plan sponsors
But the true fiduciary advantage is more than just savings. It’s about aligning your company’s values and fiduciary duty with its PBM. It’s about accountability. And ultimately, it’s about doing what’s right for your employees—providing them with access to high-quality, affordable care without compromise.
The result? A sustainable solution that delivers better care for employees and a healthier bottom line for your business.
The US-Rx Care Difference
Have you been told: “You should be happy with annual increases that don’t reach double digits.” This is a myth that has pervaded the industry for years by both PBMs and those hanging onto the status quo. At US-Rx Care, we have never accepted the status quo. We provide self-insured employer and health plan employees with fiduciary compliant, pharmacy benefits risk management services that leverage a level of clinical rigor, administrative tools, perspectives, and approaches that have been honed, perfected, and time-tested for close to three decades. Our clients typically see between a 30-50% reduction in pharmacy benefits spend—with no change in benefit designs and minimal member disruption. Plan participants also typically enjoy a 30% reduction in out-of-pocket costs and are appreciative of the time and effort expended on their behalf to optimize their drug therapy and lower their spend.
What can the fiduciary PBM model deliver for you and your business? Let’s talk! Schedule a meeting at usrxcare.com/contact.
Pharmacy benefit managers have become woven into the fabric of the health insurance system, but their role is increasingly being questioned as health plan enrollees, employers and the health plans themselves are not benefiting and may actually end up paying more for their medications.
PBMs, which contract with health plans to reduce prescription drug costs for patients, are increasingly coming under fire for their lack of transparency and allegations that they are profiting handsomely from their arrangements and not affecting costs as promised.
Congress has floated legislation aimed at barring these companies from using certain tactics, while states’ attorneys general have filed lawsuits accusing them of driving rates up and not sharing savings with health plan enrollees.
Critics say that PBMs employ several strategies that increase the financial burden on both patients and health plans.
Tactics that inflate drug costs
Spread pricing— Spread pricing is a practice where PBMs charge health plans more for a medication than they reimburse pharmacies for dispensing it. In many cases, the pharmacies that dispense medications earn slim margins, while PBMs reap significant profits.
Rebates— PBMs negotiate rebates from drug manufacturers in exchange for placing their products in preferred positions on health plan formularies (lists of covered medications). These rebates are often not passed on to patients, creating an incentive for PBMs to prioritize higher-cost drugs that offer larger rebates.
Clawbacks— PBMs also use “clawback” fees to extract additional revenue from pharmacies. Under Medicare Part D, for instance, PBMs can impose “remuneration fees” on pharmacies long after a prescription has been filled. These fees reduce the reimbursement that pharmacies receive. Meanwhile, patients see little benefit from these additional charges.
Steering patients to PBM-owned pharmacies— The country’s largest PBMs own their own mail-order or specialty pharmacies and often pressure patients to use them instead of their preferred local pharmacy. This vertical integration limits competition, raises prices and undermines the independence of community pharmacies.
Legal and legislative challenges
The opaque practices of PBMs have not gone unnoticed. Congress and state legislatures have ramped up efforts to hold PBMs accountable for their role in driving up drug costs.
Several states, including Ohio, Kentucky and Arkansas, have launched investigations into PBM practices, with some states filing lawsuits to recover taxpayer dollars lost to spread pricing and other abuses:
Ohio Attorney General lawsuit: In 2019, Ohio sued PBMs for overcharging the state Medicaid program through spread pricing. The lawsuit alleged that PBMs billed the state far more than they reimbursed pharmacies, pocketing millions in the process.
Arkansas Supreme Court case: Arkansas won a major legal battle when the U.S. Supreme Court upheld the state’s right to regulate PBM reimbursement practices in 2020. The ruling empowered other states to introduce similar legislation aimed at curbing PBM abuses.
New York investigation into clawbacks: New York has investigated how PBMs use clawback fees to exploit pharmacies and reduce reimbursements. The findings revealed systemic overcharges to the state’s Medicaid program.
In Congress, bipartisan efforts are underway to improve PBM transparency. The Pharmacy Benefit Manager Transparency Act seeks to ban spread pricing and ensure that rebates benefit patients rather than PBMs. Meanwhile, the Federal Trade Commission has launched inquiries into anti-competitive PBM practices, signaling a broader regulatory crackdown.
A call for reform
As public and legislative pressure intensifies, the future of PBMs is likely to change.
Transparency, fair reimbursement practices and the elimination of profit-driven tactics are critical to restoring trust and reducing drug costs. Patients, providers and pharmacies are calling for reforms that prioritize accessibility and affordability.
For now, PBMs remain a significant driver of rising drug costs in the U.S., and their practices are an area ripe for reform.
Pharmacy Benefit Managers come in two different forms: fiduciary and non-fiduciary. Fiduciary PBMs prioritize the interests of their clients above all else, operating with full price transparency and eliminating every conflict of interest, while non-fiduciary PBMs (also called traditional PBMs) do not have a legal obligation to act in the best interest of their clients. Because of this lack of obligation, non-fiduciary PBMs often use various strategies to collect hidden profits, such as:
Spread Pricing: Charging clients a higher price for a drug than they reimburse pharmacies for dispensing it, and then retaining the difference or “spread” as profit.
Exclusion of Low-Cost Alternatives: Requiring patients to take a drug with a higher sticker price when a cheaper alternative is available because that drug yields higher rebates or margins for the PBMs own profit.
These represent only two examples of the many strategies PBMs use to hide costs, with the common thread being that PBMs use these tools to maximize their own profits. These practices lead clients to (unknowingly) waste money – funds they could use elsewhere – to pay for these hidden costs.
Non-fiduciary PBMs exploit their client’s finances when they should be stewarding them.
Formularies as a Target for Hidden Profits
Formularies are curated lists of drugs developed by health plans, insurance providers, or PBMs to serve as a guide for patients, healthcare providers, and pharmacies to understand which medications are available under the plan and under what conditions. Unfortunately, traditional PBMs have identified formularies as one target for maximizing hidden profits.
Drug manufacturers provide kickbacks, or “rebates,” to PBMs as an incentive for placing their drugs on a “preferred tier” of drugs, making physicians more likely to prescribe them and patients more likely to purchase them, increasing the manufacturer’s sales. After the patient purchases the medication, the manufacturer pays the PBM the “rebate.” While the intention is for PBMs to then share the rebate with the employer or insurer, they often choose to keep a significant portion of it for their own revenue. This leads to increased costs for employers because while these rebates lower the net cost for PBMs, employers rarely receive the full benefit of these rebates. They may also pay higher gross prices for drugs on the formulary because rebates are tied to higher list prices.
These practices are common among non-fiduciary PBMs because they have no legal obligation to act in the best interest of their clients. With a primary focus on maximizing profits, they are actually hiding costs from health plans, employers, and patients. Fiduciary PBMs like US-Rx Care, on the other hand, prioritize the interests of their clients above all else and operate with full transparency to eliminate every conflict of interest.
Pharmacy Restrictions Often Result in Hidden Profits
By limiting pharmacy access to their own mail-order and specialty pharmacies for certain medications, PBMs can use various tactics to maximize profits at their client’s expense.
For instance, a claim for a generic medication, which would typically be priced competitively under retail pharmacy rate guarantees (e.g., AWP – 85%), might be processed instead by the PBM’s specialty pharmacy at a significantly higher cost, while still meeting contractual specialty rate guarantees (e.g., AWP – 30%). Other tactics include repackaging medications with unique NDCs and higher AWPs.
Additionally, large PBMs receive “class of trade” financial incentives for their mail-order and specialty pharmacies, which are often tied to the cost of the medication. These incentives encourage PBMs to dispense higher-cost drugs through their pharmacies, rather than the most clinically appropriate and cost-effective options.
The Role of Fiduciary PBMs and Utilization Management
US-Rx Care provides employers with two options for managing their pharmacy benefits: full pharmacy benefits management or behind-the-scenes utilization management. Utilization management under a fiduciary PBM works by using a clinical lens to review prescription drug claims and minimize wasteful drug spending, also called drug utilization review (DUR). In a DUR, a team of healthcare professionals reviews the claims to ensure members receive the best possible medication that offers the same clinical outcomes at the lowest available price. By making these decisions alongside healthcare professionals, fiduciary PBMs minimize waste by focusing on the best interests of the employer and employee.
Benefits of Partnering with a Fiduciary PBM
If an employer previously worked with a non-fiduciary PBM, a fiduciary PBM can help them reduce wasteful spending and lower drug costs by removing hidden costs they may not have been aware of, given the ways in which traditional PBMs hide these costs in contracts and through a lack of overall transparency. Fiduciary PBMs help employers lower costs while simultaneously prioritizing the best outcomes for patients.
Employers are continuing to realize the benefits of working with a fiduciary PBM. After switching to US-Rx Care from a traditional PBM, one multi-state hospital group saved $10 million annually by reducing prescription drug costs for their 42,900 enrollees.1 Similarly, a multi-district educational nonprofit saved over $4 million within four years through elimination of hidden profit schemes and alignment of formulary management with cost-effective and clinical goals.2
To know where to cut waste, it’s important to understand the strategies traditional PBMs use to hide costs for their own financial benefit. As exemplified above, partnering with a trusted fiduciary PBM can result in saving you enormous sums of money – literally millions of dollars- while prioritizing the best outcomes for patients. If you haven’t yet, now’s the time to evaluate your relationship with your current PBM and consider transitioning to a fiduciary PBM model that has your best interests in mind, rather than its own profits.
Sources:
US-Rx Care. Savings Strategies: How US-Rx Care Helped a Multi-State Hospital Group Save More Than $10 Million in Annual Drug Costs.
US-Rx Care. “An Education in Savings: How US-Rx Care Helped a Multi-District Educational Non-Profit Save Millions in Pharmacy Benefits Costs.”
At the U.S. Senate Committee on Health, Education, Labor, and Pensions hearing on September 24, Lars Fruergaard Jørgensen, CEO of Novo Nordisk, addressed the high cost of Ozempic and Wegovy, two of the company’s flagship drugs for diabetes and obesity. Pressed by several committee members, including Senator Bernie Sanders, Jørgensen acknowledged the complex pricing structures in the U.S. pharmaceutical market and agreed to collaborate with the Committee and Pharmacy Benefits Managers (PBMs) to find pricing solutions.
How PBM Pricing Structures Drive Up Costs
PBMs act as intermediaries between insurance companies, pharmacies, drug manufacturers, and patients. They decide which drugs will be included under specific health plans, negotiate rebates and discounts with pharmaceutical companies, and work with pharmacies to set pricing for dispensing medications. While these responsibilities may sound straightforward, PBMs’ profit-driven practices add layers of complexity and cost to the system.
Under the PBM rebate model, pharmaceutical companies provide rebates to PBMs as an incentive for formulary placement, or placement on a “preferred tier” that will be more likely to be prescribed and purchased, increasing the manufacturer’s sales. PBMs also negotiate with the drug manufacturer based on how many patients are likely to use the drug and its competition. These rebates are often structured as a percentage of the drug’s Wholesale Acquisition Cost (WAC) – with average rebates close to 30% of the drug’s WAC.1 The rebate is then paid to the PBM after the medication is dispensed and purchased by a patient. PBMs then either share the rebate with the health plan (employer or insurer), or retain a portion of the rebate for their own revenue. The exact split of the revenue depends on contractual agreements between the PBM and the employer.
Drug manufacturers also classify supply chain organizations under a system called “class of trade” (COT), which allows them to offer different pricing structures or discounts based on categorization, such as retail pharmacies, wholesalers, or hospitals. However, there is no set list or standardized procedure for how PBMs categorize.
The PBM’s mail order or specialty pharmacy typically sits under a different COT than the PBM itself because it’s a subsidiary. The catch? There is a COT purchasing contribution that the manufacturer also pays to this subsidiary, and this usually amounts to 30% – 40% of the WAC. Because it’s a subsidiary, this amount is reported separately and not included in the PBM report and investigations.
Not only is this lack of transparency problematic, but the higher the drug price, the more the PBM benefits. Sometimes PBMs will even require patients to take a drug with a higher sticker price when a cheaper alternative is available. These high drug prices are then passed on to employers in the form of higher insurance premiums for their employees’ coverage.
Furthermore, pharmaceutical companies have been found to pay some physicians 5% of the WAC to prescribe their medication instead of their competitor’s medication as a first-line agent, or the most effective and low-risk option, even in cases where it is a last-line agent, or the least effective and highest risk.2
Conflicts of Interest & Holding Employers Accountable
The Consolidated Appropriations Act (CAA) now holds employers responsible for ensuring that their benefits vendors comply with fiduciary standards. However, PBM brokers are often incentivized to prioritize PBMs’ interests over those of employers and employees, perpetuating a system that benefits the PBMs and drug manufacturers at everyone else’s expense.
With growing public awareness and heightened scrutiny from regulatory bodies like the FTC and Senate committees, employers who fail to address these conflicts risk reputational and financial consequences as well as having their senior officers face personal liability.
Employers Must Lead the Change
US-Rx Care operates as an independent third-party partner, bridging the gap between payers and drug manufacturers while emphasizing a fiduciary approach to drug utilization management. We put your employees’ health outcomes and cost savings first. Unlike non-fiduciary PBMs, we focus on lowering costs and delivering better care without hidden agendas.
In addition, Partner with a non-conflicted pharmacy consultant to ensure your PBM contracts reflect your goals and values. Learn more about controlling costs without sacrificing quality of care.Contact us today for a list of non-conflicted consultants or to discuss how we can address your PBM-related challenges. Take back control of your healthcare spending.
American pharmaceutical companies are arguably the world’s most inventive, regularly introducing specialty medications for an array of chronic health conditions that are on the rise. But they don’t do it for free, and the costs are becoming more and more difficult for employers to carry.
As of 2020, 6 in 10 adults in the U.S. had a chronic disease.1 Specialty drugs to treat these conditions now account for over 50% of total prescription drug spending despite being used by only 2.5% of patients.2 The good news is that the right pharmacy benefit management partner can dramatically reduce these costs for both employers and employees.
The Specialty Drug Dilemma
Specialty drugs are innovative treatments designed to address complex or chronic conditions such as multiple sclerosis, cancer, and rheumatoid arthritis. While these medications can greatly improve quality of life, they come with a hefty price tag. The average annual cost for a specialty drug is a staggering $84,000,3 more than ten times the cost of regular prescription medications.
The explosive growth in specialty drug costs is putting immense pressure on healthcare budgets, with estimates indicating that specialty drug spending would add up to $311 billion for 2023.4 For employers and plan sponsors, this trend poses a significant threat to the sustainability of their pharmacy benefit plans.
Strategies for Plan Sponsors and Benefits Advisors
To shelter employees and clients from the enormous costs of specialty drugs, plan sponsors and benefits advisors should consider the following approaches:
Utilize Specialty Pharmaceutical Programs: Well-designed specialty drug management programs can help achieve lower costs without compromising care quality.
Employ Utilization Management Techniques: Strategies such as prior authorization, step therapy, and prescription duration limits can help control costs while ensuring appropriate medication use.
Leverage Data Analytics: Regularly analyzing drug spending across both medical and pharmacy benefits can inform plan design decisions and identify cost-saving opportunities.
A fiduciary Pharmacy Benefit Manager (PBM) like US-Rx Care can be a game-changer in managing specialty drug costs. Unlike traditional PBMs, fiduciary PBMs are legally obligated to act in the best interest of their clients, ensuring transparency and alignment of incentives. US-Rx Care offers several advantages as a fiduciary PBM:
Transparent Pricing: Full disclosure of all revenue sources, eliminating hidden fees and conflicts of interest.
Customized Formularies: Tailored drug lists that balance clinical efficacy with cost-effectiveness.
Advanced Analytics: Sophisticated data analysis to identify trends and optimization opportunities.
Clinical Expertise: Access to pharmacists and healthcare professionals for personalized guidance.
Right Rx Services: An Alternative Approach
For organizations not ready to change their PBM, US-Rx Care’s Right Rx services offer an alternative path to cost optimization. These services work alongside existing PBM arrangements to:
Analyze current drug spending and utilization patterns
Identify opportunities for cost savings without compromising care
Implement targeted interventions to optimize prescription drug use
Provide ongoing monitoring and adjustment of strategies
By engaging Right Rx services, employers can achieve significant cost savings while maintaining their current PBM relationship, offering a flexible approach to pharmacy benefit management. By advocating strictly for your enrollees’ best interests, Right Rx saves an average of $15 – $25 per enrollee per month, with over 30% or greater out-of-pocket savings for non-specialty, specialty, and J-code prescription drugs.
Choose the Solution That Works For, Not Against, Your Plan
As a leader in the fiduciary PBM space, US-Rx Care has the clinical and pharmacy benefit administration expertise necessary to sharply cut the costs of needed prescription drugs. Our full PBM solution is proven to save up to 50% on pharmacy benefit costs in just 12 months for self-insured employers. Alternatively, employers who wish to keep their PBMs can contract out utilization management and prior authorization functions to our clinically-based Right Rx program. Whether your organization is looking for partial or full pharmacy optimization, US-Rx Care has the tools and cost-saving frameworks in place to deliver the savings and plan value your enrollees deserve.
Learn more about US-Rx Care’s pharmacy benefits services to discover which solution is best for your plan, and take control of rising prescription drug costs today.
Centers for Disease Control and Prevention, “Chronic Diseases in America.” https://cdc.gov/chronicdisease/resources/infographic/chronic-diseases.htm
IQVIA Institute for Human Data Science. “The Use of Medicines in the U.S. 2022.”
AARP Public Policy Institute. “Trends in Retail Prices of Specialty Prescription Drugs Widely Used by Older Americans: 2006 to 2015.”
IQVIA Institute for Human Data Science: “The Global Use of Medicine in 2019 and Outlook to 2023.”
