Decoupling PBM Fees Enhances Patient Outcomes

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The pharmaceutical supply chain is rife with misaligned incentives. Due to these disincentives, policies that make sense under most market conditions create problems that harm patients. Coupling the fees of pharmacy benefit managers (PBMs) to the discounts they negotiate exemplifies this problem.

The three largest PBMs—Caremark (CVS Health/Aetna AET 0.0%), Express Scripts ESRX 0.0% (Cigna CI +0.7%), and OptumRx (UnitedHealth Group UNH +0.2%)—control 80% of the market and are integrated into large health insurance conglomerates. PBMs negotiate drug prices with pharmaceutical companies on behalf of insurers and manage their drug formularies.

Read the full article by Sally Pipes and Wayne Winegarden at

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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