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‘Alternative' PBMs Say Vertical Integration Unfairly Carving Them Out Of The Game

 
• By Sarah Karlin-Smith

Alternatives to the top pharmacy benefits managers argue health plan-PBM integration is leading to anti-competitive tactics that make it impossible for some employers to switch PBMs. 

stacked of carved pumpkins for Halloween
Carving out PBM services from a vertically integrated health company can be extremely difficult or cost-prohibitive and is anti-competitive, smaller PBMs argue. • Source: Shutterstock

Alternatives to the top pharmacy benefits managers say they have fairer and more cost-effective business models for administering employers’ drug benefits, but the vertical integration and power of the largest health insurance companies and PBMs often put them on uneven footing.

Key Takeaways

  • Vertical integration between health insurance companies and PBMs is leading to anticompetitive practices that make switching to alternative benefit managers unaffordable or impossible for self-funded employer health plans, the newer PBMs argue.

  • The alternative PBMs are pushing for federal policy solutions, such as a ban on data integration fees among health care companies

Self-funded employers can be effectively prevented from working with an alternative PBM, such as Rightway, whose business model is not based on capturing big rebates on high

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