The latest Pulse of the Purchaser survey provides critical insights for self-insured employers grappling with the evolving healthcare landscape. Below are the five most impactful takeaways from the survey, highlighting areas where employers can optimize their pharmacy benefits strategies.

1. Drug Prices Are a Primary Concern
   With nearly 100% of respondents identifying drug prices as a significant threat to healthcare affordability, managing prescription costs is paramount. Employers should consider renegotiating PBM contracts to ensure transparency in pricing, rebates, and fees. Implementing a value-based formulary instead of a rebate-driven one can yield significant cost savings.
2. Interest in PBM Reform Is Rising
   More than half of employers plan to reconsider their PBM within the next three years. The most sought-after reforms include full revenue disclosure and flexibility in formulary customization without financial penalties. By adopting these strategies, employers can regain control over drug utilization and ensure alignment with fiduciary responsibilities.
3. High-Cost Claims Demand New Strategies
   High-cost claims remain a major threat to affordability. Strategies such as site-of-care redirection (e.g., home infusion) and enhanced case management are seeing increased adoption. Employers can mitigate the budgetary impact of large claims by incorporating precision medicine and partnering with centers of excellence.
4. GLP-1 Coverage and Obesity Management
   Coverage for GLP-1 drugs and other anti-obesity medications is gaining traction. However, cost-mitigation strategies, such as limiting access to high-risk populations and covering compounded alternatives, are crucial. Employers offering obesity management programs, including lifestyle interventions and bariatric surgery, are ahead of the curve in controlling related healthcare costs.
5. Transparency and Fiduciary Responsibility in Focus
   Fiduciary duties are increasingly under the spotlight, with employers expressing concerns about the integrity and conflicts in PBM and hospital billing practices. Ensuring independent audit rights and retaining ownership of all health plan data can strengthen employers’ fiduciary oversight and drive down unnecessary expenses.

By acting on these insights, self-insured employers can better manage rising healthcare costs while safeguarding the health and well-being of their workforce.

Copay Adjustment Programs: What Are They and What Do They Mean for Consumers and other notes from around the interweb:

• Copay Adjustment Programs: What Are They and What Do They Mean for Consumers? Americans spend on average more than $1,000 per person per year on prescription drugs, far surpassing prescription drug spending in other peer nations. According to a 2023 KFF poll, 3 in 10 adults taking prescription drugs report that they have not taken their medication as prescribed due to costs. In a 2023 KFF consumer survey, nearly one-quarter (23%) of insured adults reported that their health insurance did not cover a prescription drug or required a very high copay for a drug that a doctor prescribed, increasing to more than one-third (35%) of insured adults in fair or poor physical health. People who need specialty or brand-name medications to treat chronic health conditions such as diabetes, cancer, arthritis, and HIV are especially vulnerable to high costs, particularly considering rising deductibles over the years.

• Analysis finds that after 2 years GLP-1 drugs for weight loss don’t justify their price. Patients who have taken popular GLP-1 medications for weight loss aren’t saving themselves or their health plans any money, at least not right away. Eagan-based pharmacy benefits manager Prime Therapeutics issued that disappointing finding this week after analyzing the health care spending of thousands of patients who started taking GLP-1 medications in 2021, comparing them with similar patients who didn’t take the drugs. Spending was $4,206 higher per patient the year after they started taking the GLP-1 medications compared to the group of patients who didn’t take it, primarily because of the costly medications themselves. “It’s too soon to conclude whether these drugs will have a return on investment from a total cost of care perspective,” said David Lassen, Prime’s vice president of primary clinical services. “We didn’t expect to see that in two years, but we were hopeful that we would start to see something!”

• ‘Biosimilar’ drugs are gaining market share, Tufts researchers find. Biosimilars drugs are almost identical copies of original biologic products. Early biosimilars had slower adoption and savings than expected; however, biosimilars launched in recent years have had more success. With several biosimilar launches planned in the next few years, it is important to understand how the state of the market might foretell significant market savings in the future. To do so, we explored how the introduction of biosimilars affected originator-biosimilar markets during the period 2017–22. We found that after biosimilar availability, payers increasingly allowed choice of preferred products. By 2022, 76 percent of commercial payers’ coverage policies listed two or more products (originator or biosimilar) as first-line options. Biosimilar market shares exceeded those of originators by a mean of three years after the first biosimilar launch, and originator-biosimilar market average sales price declined substantially. Taken together, these findings provide evidence of a functioning competitive market.

• FDA Approves IV Form of Stelara Biosimilar Selardsi. Alvotech and Teva Pharmaceuticals announced this week the FDA approval of Selardsi (ustekinumab-aekn) to treat adults with moderately severe and severe Crohn’s disease or ulcerative colitis, according to a news release. This approval is an expansion on the reference product Stelara and is expected to launch in the first quarter of 2025 in the United States. Selardsi will be available in a 130 mg/26mL single dose and will be administered intravenously. Dosage is dependent on weight. If the patient weighs 121 pounds or less, they will be given two vials. Patients weighing between 121 pounds and 187 pounds should take three vials. Patients weighing more than 187 pounds should be given four vials. Subcutaneous maintenance doses of 90mg should be given every eight weeks after the initial intravenous dose.

Managing specialty pharmacy benefits has become a critical challenge for self-insured employers and benefit consultants alike. With specialty drugs accounting for over 50% of pharmacy spend, it’s essential to balance cost management with patient outcomes. Here are three key considerations for specialty pharmacy benefits management: price, clinical appropriateness, and drug mix.

Price: Breaking Down the True Cost

Specialty drug prices are notoriously high, and without proper oversight, costs can skyrocket. The first step in controlling spend is to ensure that you’re paying a fair price for the drugs your employees are using. Traditional PBMs may inflate costs through opaque pricing models, rebates, and spread pricing. To combat this, employers should:

• Demand transparency: Insist on a transparent, fiduciary model where your PBM charges only what the drug costs—nothing more, nothing less. This ensures there are no hidden markups or conflicts of interest.
• Implement cost-control measures: Require your PBM to actively negotiate with manufacturers for better pricing and rebates while using strategies like step therapy and prior authorization to ensure appropriate utilization. Additionally, price-lock guarantees and inflation protection clauses can offer predictability and protect against future cost hikes.

Clinical Appropriateness: Ensuring Optimal Use

Simply managing costs is not enough—it’s critical that specialty drugs are being used appropriately. This involves assessing whether the prescribed drug is the most clinically appropriate option for the patient based on their condition and overall health.

• Utilization management: Implement rigorous prior authorization protocols that evaluate the necessity of the specialty drug. This can prevent overprescribing or the use of more expensive drugs when equally effective, lower-cost options are available.
• Ongoing monitoring: Continuous evaluation of therapy effectiveness and adherence is key. Specialty drugs often require complex administration and management, so it’s important that patients are following their treatment plans and that the drugs are working as intended. Partner with a PBM that offers comprehensive patient support services and clinical oversight.

Drug Mix: Structuring an Efficient Specialty Formulary

The final piece of the puzzle is optimizing your specialty drug mix. This means ensuring that the drugs on your formulary provide the best value—both in terms of price and clinical outcomes.

• Formulary management: Work with your PBM to establish a tightly managed specialty drug formulary that prioritizes clinically effective, lower-cost alternatives such as biosimilars. Don’t just include drugs because they’re new—evaluate each drug for value and efficacy.
• Promote biosimilars: Biosimilars provide a great opportunity for cost savings. They are clinically equivalent to brand-name biologics but are often significantly less expensive. Ensuring they are included in your formulary and promoted as the preferred option can yield substantial savings.

Conclusion

By focusing on price transparency, ensuring clinical appropriateness, and optimizing your drug mix, self-insured employers can manage their specialty pharmacy benefits effectively. The goal is to strike the right balance between controlling costs and ensuring the best possible health outcomes for your employees. Working with a PBM that is aligned with your fiduciary responsibilities can help you achieve that balance and avoid the pitfalls of a profit-driven model.

For those seeking further guidance, TransparentRx offers a fiduciary model designed to reduce specialty drug costs while maintaining high standards of care. Reach out today to learn how we can help you create a sustainable and effective specialty pharmacy benefit.

‘Biosimilar’ drugs are gaining market share, Tufts researchers find and other notes from around the interweb:

• ‘Biosimilar’ drugs are gaining market share, Tufts researchers find. Biosimilars drugs are almost identical copies of original biologic products. Early biosimilars had slower adoption and savings than expected; however, biosimilars launched in recent years have had more success. With several biosimilar launches planned in the next few years, it is important to understand how the state of the market might foretell significant market savings in the future. To do so, we explored how the introduction of biosimilars affected originator-biosimilar markets during the period 2017–22. We found that after biosimilar availability, payers increasingly allowed choice of preferred products. By 2022, 76 percent of commercial payers’ coverage policies listed two or more products (originator or biosimilar) as first-line options. Biosimilar market shares exceeded those of originators by a mean of three years after the first biosimilar launch, and originator-biosimilar market average sales price declined substantially. Taken together, these findings provide evidence of a functioning competitive market.

• PBM Math: Big Chains Are Paid $23.55 To Fill a Blood Pressure Rx. Small Drugstores? $1.51. Alternate Funding Programs, such as copay assistance programs (CAPs), are offered by manufacturers on some brand name medications to lower patients’ out-of-pocket costs. While the focus is on removing barriers, if not managed, these programs can circumvent the formulary and the plan design’s ability to steer members toward lower cost and effective therapies. In response, Pharmacy Benefit Managers (PBM) have developed programs that plan sponsors can opt into. PBMs either manage their own programs or outsource all or a portion of their programs. One such program is manufacturer copay assistance programs. CAPs are non-need-based programs for those on commercial or private insurance. PBMs typically manage CAP in two ways: accumulator programs and/or variable copay programs.

• Supreme Court takes up PBM case: Does ERISA preempt states’ efforts to regulate drug prices? The U.S. Supreme Court plans to look at states’ ability to regulate pharmacy benefit managers this term. Glen Mulready, Oklahoma’s insurance commissioner, is trying to overturn an appeals court ruling that found that the Employee Retirement Income Security Act of 1974 benefits rule uniformity provisions preempt state efforts to regulate PBMs when the PBMs are serving self-funded employer health plans. The Supreme Court “has long cautioned against stretching ERISA to preempt laws in ‘traditionally state-regulated’ areas about which ‘ERISA has nothing to say,’ Mulready says in a brief filed in connection with the case, Mulready v. Pharmaceutical Care Management Association. “Pharmacy regulation is an area of traditional state concern and neither PBMs nor prescription-drug benefits are mentioned anywhere in ERISA.” But the PCMA, the PBMs’ group, says ERISA should preempt the Oklahoma PBM law.

• Employers haven’t a clue how their drug benefits are managed. Most employers have little idea what the pharmacy benefit managers they hire do with the money they exchange for the medications used by their employees, according to a KFF survey released Wednesday morning. In KFF’s latest employer health benefits survey, company officials were asked how much of the rebates collected from drugmakers by pharmacy benefit managers, or PBMs, is returned to them. In recent years, the pharmaceutical industry has tried to deflect criticism of high drug prices by saying much of that income is siphoned off by the PBMs, companies that manage patients’ drug benefits on behalf of employers and health plans. Employers may assume the PBMs are acting in their best interest, but they don’t have a legal obligation to do so.

When managing pharmacy benefits, one of the least transparent practices utilized by many Pharmacy Benefit Managers (PBMs) is the use of multiple Maximum Allowable Cost (MAC) lists. This tactic, while complex, can significantly affect plan sponsors, especially Benefit Directors, employee benefit brokers, and PBM consultants, by inflating costs and undermining transparency.

What are MAC Lists?

A MAC list is a pricing benchmark used by PBMs to determine the maximum amount a plan will pay for generic drugs and in some cases multisource brand drugs. Ideally, a single, well-structured MAC list should set a consistent reimbursement rate, ensuring fair pricing across pharmacies. However, some PBMs use multiple MAC lists, which is where the problem begins.

The Downside of Multiple MAC Lists

When PBMs deploy multiple MAC lists, each pharmacy or pharmacy network may be reimbursed differently for dispensing the same drug. For example, chain pharmacies might receive higher reimbursements than independent pharmacies for the same generic drug, despite all pharmacies purchasing from similar wholesalers.

A real-world example that illustrates this disparity comes from a recent audit of Mississippi’s commercial prescription drug claims for the calendar year 2022. The audit revealed that a large PBM used 49 distinct MAC lists, with specific lists exclusively applied to chain or independent pharmacies. On average, independent pharmacies were reimbursed 74% less than chain pharmacies for the same drugs. This discrepancy highlights how PBMs manipulate MAC lists to inflate costs for plan sponsors while benefiting select pharmacies.

For Benefit Directors and PBM consultants, the practice of using multiple MAC lists means that PBMs have more room to game the system. Costs that appear controlled on paper may actually be much higher due to varying reimbursement rates. Furthermore, this approach allows PBMs to mask their true margins, making it difficult for plan sponsors to understand where their money is going.

Increased Costs and Lack of Transparency

One of the most significant issues with multiple MAC lists is the lack of transparency. Each list is proprietary, meaning plan sponsors have no way of verifying how much pharmacies are reimbursed or comparing costs across networks. As a result, plan sponsors can find themselves paying more for generic drugs without realizing it, especially if their PBM reimburses affiliate or chain pharmacies at higher rates than independents, as demonstrated in the Mississippi Board of Pharmacy audit.

For example, in the same audit, generic azithromycin was reimbursed at vastly different rates: one independent pharmacy was reimbursed at only 122% of the lowest chain pharmacy reimbursement, while an affiliate pharmacy received 833.3%. These hidden costs accumulate over time, leading to higher overall drug spend, which is then passed on to the plan sponsor.

The Fiduciary PBM Model: A Transparent Alternative

In contrast to this opaque practice, a fiduciary PBM model ensures that the PBM is aligned with the client’s best interests. A fiduciary PBM operates under a legal obligation to manage costs and prioritize transparency. There are no hidden markups, and reimbursement rates are consistent across all pharmacy networks, ensuring that plan sponsors can trust that the lowest price is always being paid for a given drug.

How Fiduciary PBMs Keep Costs Down

• One Transparent MAC List: Fiduciary PBMs utilize a single, transparent MAC list, applying uniform rates across all pharmacies, which eliminates the possibility of hidden profit margins through inflated reimbursement rates.
• Accountability: By adhering to a fiduciary standard, these PBMs must disclose any conflicts of interest and ensure that they do not profit at the client’s expense.
• Cost Control: With the fiduciary model, PBMs are incentivized to actively control drug costs and improve outcomes rather than focusing on maximizing their own margins. This leads to more predictable and often lower drug spend for employers.

Conclusion

For Benefit Directors, employee benefit brokers, and PBM consultants, the use of multiple MAC lists by traditional PBMs presents a significant risk in terms of increased costs and lack of transparency. In contrast, the fiduciary PBM model offers a clear path to managing pharmacy benefits with alignment, cost control, and accountability. By choosing a fiduciary PBM, plan sponsors can ensure that they are paying fair and consistent prices for medications, ultimately protecting their bottom line.

The key takeaway here is clear: when evaluating PBM options, understanding the intricacies of MAC list usage can be the difference between controlling costs or unknowingly inflating them.

Supreme Court takes up PBM case: Does ERISA preempt states’ efforts to regulate drug prices and other notes from around the interweb:

• Supreme Court takes up PBM case: Does ERISA preempt states’ efforts to regulate drug prices? The U.S. Supreme Court plans to look at states’ ability to regulate pharmacy benefit managers this term. Glen Mulready, Oklahoma’s insurance commissioner, is trying to overturn an appeals court ruling that found that the Employee Retirement Income Security Act of 1974 benefits rule uniformity provisions preempt state efforts to regulate PBMs when the PBMs are serving self-funded employer health plans. The Supreme Court “has long cautioned against stretching ERISA to preempt laws in ‘traditionally state-regulated’ areas about which ‘ERISA has nothing to say,’” Mulready says in a brief filed in connection with the case, Mulready v. Pharmaceutical Care Management Association. “Pharmacy regulation is an area of traditional state concern and neither PBMs nor prescription-drug benefits are mentioned anywhere in ERISA.” But the PCMA, the PBMs’ group, says ERISA should preempt the Oklahoma PBM law.

• What Went Wrong: How Formularies, Contracts, and Rebates Created a Headwind for Biosimilars. The promise of biosimilars was supposed to be simple: more competition, lower costs and better access for patients. Yet as the dust settles from the introduction of adalimumab biosimilars following Humira’s (AbbVie) patent expiration at long last, it’s clear that formularies have become one of the biggest barriers to realizing the cost-saving potential of biosimilars. When adalimumab-atto (Amjevita; Amgen), the first biosimilar for adalimumab, launched, its adoption was alarmingly low.1 As other biosimilars entered the market in quick succession, hopes were high that price competition would soon follow. But the market manipulation enabled by formulary management has instead slowed down the entire process by creating significant headwinds.

• Employers haven’t a clue how their drug benefits are managed. Most employers have little idea what the pharmacy benefit managers they hire do with the money they exchange for the medications used by their employees, according to a KFF survey released Wednesday morning. In KFF’s latest employer health benefits survey, company officials were asked how much of the rebates collected from drugmakers by pharmacy benefit managers, or PBMs, is returned to them. In recent years, the pharmaceutical industry has tried to deflect criticism of high drug prices by saying much of that income is siphoned off by the PBMs, companies that manage patients’ drug benefits on behalf of employers and health plans. Employers may assume the PBMs are acting in their best interest, but they don’t have a legal obligation to do so.

• PBM 101: Manufacturer Copay Assistance Programs. Alternate Funding Programs, such as copay assistance programs (CAPs), are offered by manufacturers on some brand name medications to lower patients’ out-of-pocket costs. While the focus is on removing barriers, if not managed, these programs can circumvent the formulary and the plan design’s ability to steer members toward lower cost and effective therapies. In response, Pharmacy Benefit Managers (PBM) have developed programs that plan sponsors can opt into. PBMs either manage their own programs or outsource all or a portion of their programs. One such program is manufacturer copay assistance programs. CAPs are non-need-based programs for those on commercial or private insurance. PBMs typically manage CAP in two ways: accumulator programs and/or variable copay programs.

Pharmacy Benefit Managers (PBMs) have a significant role in managing prescription drug plans for employers, brokers, and benefits consultants. However, the lack of transparency in their operations often leaves organizations in the dark about the true costs tied to their pharmacy benefits. That’s where our webinar, Unlocking the Secrets of PBMs: Strategies to Navigate Their Profit Tactics, can help. It provides an in-depth look at how PBMs operate and gives you the insights needed to better control your pharmacy expenses.

During this session, we explore strategies designed to help employers, brokers, and consultants spot and address hidden profit tactics that inflate costs. PBMs often use complex pricing, hidden fees, and undisclosed rebate agreements, which can significantly drive up the cost of benefits. Attendees will learn how to recognize these tactics and implement strategies to mitigate their financial impact.

One major takeaway from the webinar is the value of adopting a fiduciary standard of care. Unlike traditional PBM models, which focus on profit, a fiduciary PBM puts the plan sponsor and its members first. This approach not only ensures ethical business practices but also helps reduce costs without sacrificing patient care. We’ll highlight real-world examples showing how fiduciary PBMs make a difference in controlling costs.

Additionally, the webinar offers practical tips for negotiating better contracts, optimizing formulary management, and using data analytics for informed decision-making. These strategies will help you create a more transparent, cost-effective pharmacy plan tailored to your organization. With these tools, you can ensure every dollar spent on pharmacy benefits brings value to both your organization and your members.

If you’re an employer, broker, or consultant aiming to reduce pharmacy costs while maintaining high-quality care, this webinar is essential. Learn from industry experts who have been deeply involved in PBM negotiations and cost management. Take the first step toward a more transparent and patient-centered pharmacy benefit strategy by watching Unlocking the Secrets of PBMs: Strategies to Navigate Their Profit Tactics today.

How Formularies, Contracts, and Rebates Created a Headwind for Biosimilars and other notes from around the interweb:

• What Went Wrong: How Formularies, Contracts, and Rebates Created a Headwind for Biosimilars. The promise of biosimilars was supposed to be simple: more competition, lower costs and better access for patients. Yet as the dust settles from the introduction of adalimumab biosimilars following Humira’s (AbbVie) patent expiration at long last, it’s clear that formularies have become one of the biggest barriers to realizing the cost-saving potential of biosimilars. When adalimumab-atto (Amjevita; Amgen), the first biosimilar for adalimumab, launched, its adoption was alarmingly low.1 As other biosimilars entered the market in quick succession, hopes were high that price competition would soon follow. But the market manipulation enabled by formulary management has instead slowed down the entire process by creating significant headwinds.

• Employers haven’t a clue how their drug benefits are managed. Most employers have little idea what the pharmacy benefit managers they hire do with the money they exchange for the medications used by their employees, according to a KFF survey released Wednesday morning. In KFF’s latest employer health benefits survey, company officials were asked how much of the rebates collected from drugmakers by pharmacy benefit managers, or PBMs, is returned to them. In recent years, the pharmaceutical industry has tried to deflect criticism of high drug prices by saying much of that income is siphoned off by the PBMs, companies that manage patients’ drug benefits on behalf of employers and health plans. Employers may assume the PBMs are acting in their best interest, but they don’t have a legal obligation to do so.

• Kentucky sues PBM, alleging it had a role in the deadly opioid addiction crisis. The lawsuit Attorney General Russell Coleman filed this week in state court claims St. Louis-based Express Scripts and its affiliated organizations colluded with opioid manufacturers in deceptive marketing schemes to increase sales of the addictive drugs. The result was an epidemic of “overdose and death caused by an oversupply of opioids flooding communities from powerful corporations who sought to profit at the expense of the public,” the suit says. Express Scripts responded Friday that it has long worked to combat opioid overuse and abuse and will “vigorously contest these baseless allegations in court.” Government lawsuits against pharmacy benefit managers are the latest frontier – and maybe the last big one – in years of litigation over the worst drug epidemic the U.S. has ever experienced. The class of drugs is linked to about 75,000 deaths in the U.S. in the 12 months that ended April 30.

• PBM 101: Manufacturer Copay Assistance Programs. Alternate Funding Programs, such as copay assistance programs (CAPs), are offered by manufacturers on some brand name medications to lower patients’ out-of-pocket costs. While the focus is on removing barriers, if not managed, these programs can circumvent the formulary and the plan design’s ability to steer members toward lower cost and effective therapies. In response, Pharmacy Benefit Managers (PBM) have developed programs that plan sponsors can opt into. PBMs either manage their own programs or outsource all or a portion of their programs. One such program is manufacturer copay assistance programs. CAPs are non-need-based programs for those on commercial or private insurance. PBMs typically manage CAP in two ways: accumulator programs and/or variable copay programs.

As pharmacy benefit managers (PBMs) and health plan sponsors face increasing pressure to manage costs without compromising care, one of the most effective strategies is moving J code drugs from medical to pharmacy benefit. This approach can streamline administration, increase transparency, and create more predictable pricing structures for stakeholders. In this blog, we’ll explore the benefits of this transition, and I’ll explain the key differences between HCPCS and NDC codes through a simple table.

Understanding J Code Drugs

J codes are part of the Healthcare Common Procedure Coding System (HCPCS), which healthcare providers use to bill for injectable drugs, chemotherapy, and other treatment medications administered in clinical settings. When billed under the medical benefit, these drugs often come with opaque pricing and limited oversight, making it difficult for plan sponsors to manage costs effectively.

Benefits of Moving J Code Drugs to the Pharmacy Benefit

1. Increased Cost Transparency: Under the medical benefit, drugs billed using J codes tend to come with variable pricing due to fee-for-service models and markups from healthcare providers. In contrast, the pharmacy benefit utilizes National Drug Codes (NDC), which allow for more standardized and transparent pricing, enabling better cost management and forecasting.
2. Better Clinical Management: Pharmacy benefits offer a structured formulary, prior authorization requirements, and utilization management tools that ensure members receive the most appropriate medication. With J code drugs under the pharmacy benefit, plan sponsors can implement these clinical management techniques to control utilization and promote evidence-based medicine.
3. Streamlined Claims Processing: Medical benefit claims often come with delayed payments and higher administrative complexity. By moving these drugs to the pharmacy benefit, plan sponsors can leverage electronic processing, reducing delays and ensuring more accurate reimbursement.
4. Specialty Pharmacy Expertise: Many J code drugs are high-cost specialty medications. When these drugs are shifted to the pharmacy benefit, they can be managed through specialty pharmacies that offer tailored support services like patient education, adherence programs, and risk management.
5. Mitigation of Fraud, Waste, and Abuse: The move from HCPCS to NDC coding allows for more granular data tracking, making it easier to identify potential instances of overbilling, upcoding, or inappropriate use. Pharmacy benefits also have stricter audit protocols, which can help reduce the risk of fraud.

Final Thoughts

Start by analyzing historical claims data for J code drugs under the medical benefit. Identify high-cost drugs, their utilization patterns, and the settings where they are administered (e.g., hospitals, outpatient centers). This will allow you to prioritize which drugs to transition first, focusing on those that offer the greatest potential for cost savings and clinical oversight when moved to the pharmacy benefit.

Moving J code drugs from medical to pharmacy benefit is a practical and strategic move for organizations looking to take control of rising specialty drug costs. Not only does this shift offer better financial transparency, but it also enhances clinical oversight and provides a framework for reducing inefficiencies. By leveraging the advantages of NDC-based drug management, plan sponsors can deliver better outcomes for patients while ensuring a more predictable and manageable cost structure.

Employers seeking to avoid cost-shifting even as expenses continue to rise and other notes from around the interweb:

• Employers seeking to avoid cost-shifting even as expenses continue to rise. As employers face rising costs, many are looking to rethink plan designs rather than emphasize shifting expenses to workers, according to a new WTW report. WTW released its 2024 Best Practices in Healthcare Survey on Thursday, which polled 417 employers representing 6 million workers. It found that these firms are expecting costs to balloon by 7.7% in 2025, compared to an increase of 6.9% in 2024 and 6.5% for 2023. Despite the increase, however, only 34% told WTW that they intend to shift those costs to employees by raising premiums. Twenty percent said they will push high-deductible health plans or account-based coverage to address costs. Instead, 52% said they intend to roll out programs that reduce total costs, and 51% said they would use plan designs and network models to steer workers to lower-cost and higher-quality providers.

• Monopoly Round-Up: Lina Khan, Pharma Middlemen and “Tasty Rebates”. By 2019, Sanofi was giving OptumRx, one of the biggest PBMs, 80% of the list price of Lantus just to be the preferred insulin for its patients. That’s just $64 going to Sanofi for the drug, and $339 going to OptumRx as a refund. Now, you might think that’s not a big deal. I mean, a PBM works for an insurance company, and you would think insurance companies have an incentive to keep pharma prices low. After all, insurance companies take a monthly payment from patients, and then pay for most medical expenses. A drug cost is an expense; therefore they’d like that to be lower. So, you’d imagine that the $339 refund is just a way of lowering the price to the patient. But here’s where it gets nasty.

• Kentucky sues PBM, alleging it had a role in the deadly opioid addiction crisis. The lawsuit Attorney General Russell Coleman filed this week in state court claims St. Louis-based Express Scripts and its affiliated organizations colluded with opioid manufacturers in deceptive marketing schemes to increase sales of the addictive drugs. The result was an epidemic of “overdose and death caused by an oversupply of opioids flooding communities from powerful corporations who sought to profit at the expense of the public,” the suit says. Express Scripts responded Friday that it has long worked to combat opioid overuse and abuse and will “vigorously contest these baseless allegations in court.” Government lawsuits against pharmacy benefit managers are the latest frontier – and maybe the last big one – in years of litigation over the worst drug epidemic the U.S. has ever experienced. The class of drugs is linked to about 75,000 deaths in the U.S. in the 12 months that ended April 30.

• PBM 101: Manufacturer Copay Assistance Programs. Alternate Funding Programs, such as copay assistance programs (CAPs), are offered by manufacturers on some brand name medications to lower patients’ out-of-pocket costs. While the focus is on removing barriers, if not managed, these programs can circumvent the formulary and the plan design’s ability to steer members toward lower cost and effective therapies. In response, Pharmacy Benefit Managers (PBM) have developed programs that plan sponsors can opt into. PBMs either manage their own programs or outsource all or a portion of their programs. One such program is manufacturer copay assistance programs. CAPs are non-need-based programs for those on commercial or private insurance. PBMs typically manage CAP in two ways: accumulator programs and/or variable copay programs.