Self-Funded Health Plans and Recent Challenges to State PBM Laws and other notes from around the interweb: Get Certified Now! Stuck in the Middle: Self-Funded Health Plans and Recent Challenges to State PBM Laws. In recent years, prescription drug prices have been top-of-mind for state legislators, who have responded by passing laws that seek to control that pricing in a variety of ways, including by regulating pharmacy benefit managers (PBMs). While states are permitted to regulate fully insured products offered in their state, including mandating the benefits that insurers must offer, the Employee Retirement Income Security Act of 1974, as amended (ERISA) preempts state laws that impermissibly relate to self-funded employer-sponsored health plans that are subject to ERISA. The Uneven Landscape of Prescription Coverage and Restrictions Across U.S. Insurance. Medicaid, often viewed as a safety net, covers the broadest share of prescribed drugs but imposes more restrictions than any other insurance type. Medicare, by contrast, covers the least drugs while restricting access for nearly half of the drugs that are covered. Commercial insurance, typically employer-sponsored or purchased individually, falls in the middle in terms of drug coverage but has the fewest coverage limitations, like prior authorization, quantity limits, and step therapy. Nonadherence Remains Common Concern in Dermatology. Concerns of low adherence for dermatological therapies persist, translating to poor patient outcomes, ineffective treatment, and decreased quality of life (QOL), according to a study published in Cureus.1 Researchers believe this low adherence can be owed to the sheer variety of treatment options available for a number of prominent dermatological conditions. According to the CDC, medication nonadherence is the act of a patient not taking their prescribed medicine or not following their providers’ instructions properly. While many factors can contribute to nonadherence, as well as barriers that impede patients’ ability to be adherent, it is known to result in uncontrolled blood pressure and greater rates of hospital admissions. Payers split on GLP-1 strategy. Insurers are employing different strategies to manage the high cost of GLP-1 drugs. Most GLP-1 drugs are approved to treat type 2 diabetes. Wegovy and Zepbound are approved for weight loss. The drugs often cost more than $1,000 a month. Multiple insurers have cited the high price of GLP-1 drugs as a contributing factor to financial losses in 2024. Some insurers have chosen to drop coverage of the drugs for weight loss altogether. Why TransparentRx Is Your Trusted Partner for Smarter Pharmacy Benefits At TransparentRx, we specialize in delivering fiduciary pharmacy benefit management services that prioritize transparency, cost containment, and optimal patient outcomes. Our unique approach helps self-funded employers, benefits consultants, and health plan sponsors navigate the complexities of pharmacy benefits while reducing costs and enhancing care. If you're ready to take control of your pharmacy benefit strategy and eliminate hidden fees, contact TransparentRx today for a consultation. Let us help you achieve smarter, more effective benefits management.

Pharmacy Benefit Managers (PBMs) were originally designed to help employers manage rising drug costs. Today, many have built business models that put profits ahead of patient care, creating pricing games, blocking independent pharmacies, and driving up plan costs. Arkansas is putting a stop to that. HB 1150, a new law set to take effect in 2026, will prohibit PBMs that own pharmacies from operating them in the state. The goal is simple: eliminate conflicts of interest and protect patient access to affordable care. Where the Specialty Drug Dollar Really Goes Employers, especially those with Arkansas-based members, should prepare by: Choosing PBMs without ownership ties to licensed pharmacies in the state.Working with current PBMs to ensure pharmacy networks include non-affiliated providers.Planning for pharmacy closures, especially in areas where access may already be limited. Because HB 1150 regulates pharmacy licensing, not benefit design, employers with self-funded ERISA plans likely won’t be exempt. Other states and even Congress are watching Arkansas closely. Change is coming, and employers that demand a true fiduciary standard from their PBM partners will be better positioned to control costs and protect their members. At TransparentRx, we help employers eliminate hidden conflicts and ensure pharmacy benefits are managed with complete transparency and care. If your PBM isn’t aligned with your best interests, let’s talk.

Executive Action Aims to Slash Drug Prices and Enhance PBM Clarity and other notes from around the interweb: Get Certified Now! Executive Action Aims to Slash Drug Prices and Enhance PBM Clarity. The Employer Retirement Income Security Act (ERISA) mandates strict standards for fiduciaries managing employee benefit plans, requiring careful selection, and monitoring of third-party providers like PBMs. Recently, the PBM industry faces increased scrutiny over drug costs, transparency issues, and lawsuits alleging mismanagement of prescription benefits. On April 15, 2025, President Donald Trump issued an executive order (EO) to reduce prescription drug prices in the U.S. This order instructs the Department of Labor (DOL) to enhance transparency in employer health plans regarding compensation from pharmacy benefit managers (PBM). While these changes will take time to implement, immediate cost reductions are not expected. The Rise in Direct-to-Consumer Advertising of Prescription Drugs. From the marketing of drugs with low-added benefit to manufacturers’ inability to follow FDA guidelines, direct-to-consumer advertising for prescription drugs has increased in the US and is beginning to raise alarms. “Under FDA guidelines, pharmaceutical companies are supposed to provide a balanced view of drugs in advertising in terms of their risks and benefits,” said Jenny Markell, BA, PhD Candidate of Health and Public Policy at the Johns Hopkins Bloomberg School of Public Health. “They're supposed to avoid any misleading information. It's illegal, for example, to overstate a drug’s benefits, misrepresent data from studies, or make claims that are not supported by adequate evidence.” However, even after FDA attempts of holding manufacturers accountable, drug companies continue to skew the country’s perceptions of specific prescription drugs. PBMs Score a Win in Federal Court Against State Regulation. A recent federal court decision has the potential to tip the balance in an ongoing series of skirmishes over state regulation of pharmacy benefit managers (PBMs). In McKee Foods Corp. v. BFP Inc. d/b/a/ Thrifty Med Plus Pharmacy, the US District Court for the Eastern District of Tennessee declared that an “any willing pharmacy” requirement in Tennessee was preempted by the federal Employee Retirement Income Security Act of 1974 (ERISA), as amended. On one side, self-funded group health plans argue that ERISA allows them to comply with a single set of rules nationwide, rather than having to navigate a patchwork of different, overlapping, and sometimes conflicting state laws. Arkansas governor signs legislation banning PBMs from simultaneously owning pharmacies. Arkansas lawmakers in the Senate on Wednesday passed a bill that would stop pharmacy benefit managers (PBMs) from owning pharmacies and selling drugs retail in the state. The bill now heads to the governor's desk for her signature. PBMs are the middlemen who negotiate with insurance companies, manufacturers, and pharmacies to set drug prices. Where the controversy comes in is when PBMs also own their own pharmacies, creating what many believe is a conflict of interest. CVS officials said a new law restricting Pharmacy Benefit Managers from owning pharmacies will result in the closure of more than 20 Arkansas pharmacies. Why TransparentRx Is Your Trusted Partner…

Non-fiduciary PBMs negotiate with drugmakers and pharmacies to benefit themselves. They use the purchasing power of plan sponsors who lack full insight into pharmacy economics. What used to be a cost-efficiency business is now, in many cases, about promoting the most profitable products, not the most clinically appropriate ones. If you're a smart buyer of PBM services, you want more control over your pharmacy benefit plan, not less. Here are six pillars of a high-performing pharmacy benefit plan design to help you build a plan that works in your favor. 1. Internal Expertise Internal expertise means a buyer or consultant has the knowledge to independently evaluate PBM contracts, pricing, and performance without relying on the PBM for direction. It includes deep knowledge of formularies, rebate structures, MAC pricing, and plan design strategies, for instance. Before partnering with a PBM or consultant, it’s worth asking a few key questions as a team: Do we have the pharmacy benefits expertise we need in-house?If not, would targeted education or outside support add value?Are the consultants we're relying on certified in pharmacy benefit management? As a Benefits Director, you don’t need to be a pharmacist, but you do need a strong understanding of how pharmacy benefits impact your plan's performance. Relying too heavily on a PBM or consultant without the right checks can expose your organization to unnecessary risk. That’s where Certified Pharmacy Benefits Specialists (CPBS) come in. Having credentialed support on your side gives you the clarity and leverage to keep your plan aligned with your goals, not someone else’s bottom line. 2. Access The formulary is your plan’s rulebook for drug access. It informs which medications are covered, at what cost to members, and under what conditions, guiding both prescribers and patients toward clinically appropriate and cost-effective choices. You should review formulary design regularly, especially for high-cost drug classes like GLP-1s used for weight loss. These drugs now exceed $1,000 per member per month. While effective, ICER has stated their prices are not justified by the long-term benefit in obesity treatment alone. PBMs may promote these drugs heavily due to large rebates. That’s not fiduciary. Make decisions based on outcomes and cost-effectiveness, not marketing hype or rebate flow. When managed by a fiduciary PBM, the formulary is designed to serve the plan sponsor’s best interest, not the PBM’s bottom line. 3. Medication Adherence Medication adherence refers to the extent to which a patient takes their medications as prescribed by their healthcare provider. This includes the correct dose, timing, frequency, and duration of use. Non-adherence drives over $290 billion in avoidable healthcare costs each year. Even the best-designed plan fails if members don’t take their medications. Use Proportion of Days Covered (PDC) to track adherence. A PDC of 80 percent or higher signals a member is staying on therapy. Monitor this at the plan level and intervene where necessary. Otherwise, avoidable ER visits and hospitalizations will drive up your total spend. 4. Cost Containment Cost containment in pharmacy benefits management refers to a…

Governor signs legislation banning PBMs from simultaneously owning pharmacies and other notes from around the interweb: Get Certified Now! Arkansas governor signs legislation banning PBMs from simultaneously owning pharmacies. Arkansas lawmakers in the Senate on Wednesday passed a bill that would stop pharmacy benefit managers (PBMs) from owning pharmacies and selling drugs retail in the state. The bill now heads to the governor's desk for her signature. PBMs are the middlemen who negotiate with insurance companies, manufacturers, and pharmacies to set drug prices. Where the controversy comes in is when PBMs also own their own pharmacies, creating what many believe is a conflict of interest. CVS officials said a new law restricting Pharmacy Benefit Managers from owning pharmacies will result in the closure of more than 20 Arkansas pharmacies. Overcoming Biosimilar Utilization Barriers. “The opportunities with all of these biosimilars are that they have the ability to improve patient access, new starts, persistence and adherence,” said panelist Alex Mersch, PharmD, an assistant director of ambulatory specialty programs at University of Iowa Health Care, in Iowa City. “For many organizations, especially if we look at it from the inpatient side, there’s a lot of opportunity to decrease drug costs by [replacing the reference product with] the biosimilar.” The Rise in Direct-to-Consumer Advertising of Prescription Drugs. From the marketing of drugs with low-added benefit to manufacturers’ inability to follow FDA guidelines, direct-to-consumer advertising for prescription drugs has increased in the US and is beginning to raise alarms. “Under FDA guidelines, pharmaceutical companies are supposed to provide a balanced view of drugs in advertising in terms of their risks and benefits,” said Jenny Markell, BA, PhD Candidate of Health and Public Policy at the Johns Hopkins Bloomberg School of Public Health. “They're supposed to avoid any misleading information. It's illegal, for example, to overstate a drug’s benefits, misrepresent data from studies, or make claims that are not supported by adequate evidence.” However, even after FDA attempts of holding manufacturers accountable, drug companies continue to skew the country’s perceptions of specific prescription drugs. ERISA Preemption: Impact on State PBM Laws. Pharmacy benefit managers (PBMs) play a role in the US healthcare system by negotiating drug prices and formulary placements on behalf of insurers and employer sponsored health plans. Recently, there have been concerns about certain PBM business practices, including drug pricing transparency and reimbursement rates. This has prompted numerous states to enact laws regulating PBMs. A key legal challenge to these state laws is whether ERISA preempts these laws. ERISA is a federal law that sets national standards for employer-sponsored health plans. One of its most important provisions is preemption, meaning that ERISA overrides state laws that attempt to regulate employer health plans directly. Why TransparentRx Is Your Trusted Partner for Smarter Pharmacy Benefits At TransparentRx, we specialize in delivering fiduciary pharmacy benefit management services that prioritize transparency, cost containment, and optimal patient outcomes. Our unique approach helps self-funded employers, benefits consultants, and health plan sponsors navigate the complexities of pharmacy benefits while reducing…

Not all red flags in PBM contract clauses are obvious. Some are buried in plain sight, phrased to sound harmless, even routine. But make no mistake, these clauses are often where profit hides, and where plan sponsors lose control. Here are five such clauses that deserve your full attention. 1. “Brand Effective Rate” Guarantees On the surface, a Brand Effective Rate (BER) seems like a safeguard—a guarantee you’ll get a certain discount off AWP for brand drugs. But here's the trap: PBMs typically define “brand” based on their internal classification, not by FDA or Medispan standards. That means drugs commonly accepted as generics may be counted as brands in your pricing guarantees. This manipulation boosts the PBM’s spread revenue and inflates your actual drug spend—all while appearing to honor the BER. Example clause: “PBM guarantees a Brand Effective Rate discount of 18% off AWP for brand drugs as determined by PBM’s internal classification system.” Fix: Demand clarity. The contract should reference a third-party source like Medispan for how "brand" and "generic" drugs are defined, not leave it up to the PBM. 2. “Custom Rebate” or “Non-Standard Rebate” Language Some contracts give PBMs the ability to retain rebates that fall outside the traditional formulary or performance structures. These might be labeled as “custom,” “specialty,” or “administrative” rebates. These aren’t small dollars. They’re just hidden from view. Example clause: “PBM will remit 100% of formulary rebates. PBM retains administrative, data, and market share incentives associated with manufacturer contracts.” Fix: Require full transparency and 100% pass-through on all rebates—no matter what label they carry. Avoid vague classifications. 3. “Market Check” Clauses Without Enforcement A contract might include a market check clause, promising to benchmark pricing mid-contract. But if there’s no mechanism to enforce it—or worse, the PBM controls the data source—it’s window dressing. Example clause: “PBM agrees to conduct a market check upon client request in the second contract year. PBM will assess market competitiveness and make adjustments where appropriate.” Fix: Ensure market checks are tied to independently verifiable data sources and come with actionable pricing adjustments. If it’s not enforceable, it’s useless. 4. “Sole Discretion” Language for Formulary or MAC Lists Clauses that give the PBM “sole discretion” to update the formulary or MAC pricing are dangerous. It gives them unilateral control over which drugs are covered and at what price—without accountability. Example clause: “PBM may, at its sole discretion and without prior approval, modify the formulary or MAC pricing schedule to reflect current market conditions.” Fix: Retain audit rights and require notification and approval for key formulary or MAC list changes. At a minimum, add a right to exit if the PBM acts against your financial interests. 5. “Audits Must Be Conducted by a Qualified Third Party” This one sounds reasonable—until you try to conduct an audit. PBMs often define "qualified" in a way that disqualifies anyone who might dig too deep or ask the right questions. Example clause: “Client may audit PBM once per contract year using a nationally recognized…

The Rise in Direct-to-Consumer Advertising of Prescription Drugs and other notes from around the interweb: Get Certified Now! The Rise in Direct-to-Consumer Advertising of Prescription Drugs. From the marketing of drugs with low-added benefit to manufacturers’ inability to follow FDA guidelines, direct-to-consumer advertising for prescription drugs has increased in the US and is beginning to raise alarms. “Under FDA guidelines, pharmaceutical companies are supposed to provide a balanced view of drugs in advertising in terms of their risks and benefits,” said Jenny Markell, BA, PhD Candidate of Health and Public Policy at the Johns Hopkins Bloomberg School of Public Health. “They're supposed to avoid any misleading information. It's illegal, for example, to overstate a drug’s benefits, misrepresent data from studies, or make claims that are not supported by adequate evidence.” However, even after FDA attempts of holding manufacturers accountable, drug companies continue to skew the country’s perceptions of specific prescription drugs. When middlemen own it all, patients pay the price. There’s mounting evidence that vertical integration drives up costs for patients and the government. A recent WSJ investigation showed PBMs are marking up the price of some specialty generic drugs dispensed at their specialty pharmacies by thousands of dollars. According to the FTC, pharmacies affiliated with the three largest PBMs made $1.6 billion on only two cancer drugs over the course of three years. Further, despite insurers and PBMs receiving significant rebates and discounts, often 50% or more, patients rarely benefit directly from these savings, according to the Congressional Budget Office’s Director of Health Analysis. Overcoming Biosimilar Utilization Barriers. “The opportunities with all of these biosimilars are that they have the ability to improve patient access, new starts, persistence and adherence,” said panelist Alex Mersch, PharmD, an assistant director of ambulatory specialty programs at University of Iowa Health Care, in Iowa City. “For many organizations, especially if we look at it from the inpatient side, there’s a lot of opportunity to decrease drug costs by [replacing the reference product with] the biosimilar.” Five ways to improve PBM procurement for clients. Nearly a decade ago, plan sponsors' pharmacy benefit conversations focused mostly on member satisfaction and plan compliance. Today, fiduciary duty comes first, then member satisfaction, compliance and, of course, GLP-1s, which is why employers are counting on their benefit advisers more than ever to guide them through Rx matters. Times have changed, which begs the question, "What does it take to ensure plan sponsors meet their fiduciary duty?" Putting the pharmacy benefits manager (PBM) business "out to bid" every few years isn't enough. Given heightened scrutiny of traditional PBMs and rising Employee Retirement Income Security Act (ERISA) liability risk, plan sponsors should regularly evaluate their PBM options, prioritizing strategies that lower total costs, improve member outcomes and safeguard long-term plan sustainability. However, issuing, evaluating, and managing requests for proposals (RFPs) from PBMs can be challenging. Why TransparentRx Is Your Trusted Partner for Smarter Pharmacy Benefits At TransparentRx, we specialize in delivering fiduciary pharmacy benefit management services that prioritize transparency, cost…

In pharmacy benefits, PBM "lesser of logic" determines how much the plan pays for a drug. On paper, it’s designed to protect the payer by ensuring the plan always pays the lowest price among a set of benchmark options. But PBMs often game the logic by controlling which benchmarks are included in the first place. What Is “Lesser of Logic”? It’s a pricing rule that compares multiple benchmarks for a drug claim and uses the lowest one to calculate plan cost. Typically, these benchmarks include: Benchmark TypeDescriptionAWP – DiscountAverage Wholesale Price minus a fixed % discountMAC PriceMaximum Allowable Cost set by the PBMU&C (Usual & Customary)The pharmacy’s cash priceCopaymentThe member's cost shareIngredient Cost + Dispensing FeePass-through model elementTable 1: Common Pricing Benchmarks Used in "Lesser of" Logic The logic should apply to all of these and select the lowest price for the third-party payer. But here's where the manipulation starts. BenchmarkValueAWP – 16%$112MAC Price$85U&C$92Copayment$10Ingredient Cost + Dispensing Fee ($2)$87Table 2: Transparent “Lesser of” Calculation Plan pays: $75 (MAC Price)Rationale: It's the lowest of all benchmarks. Same drug, same benchmarks, but the PBM contract excludes U&C pricing from the “lesser of” calculation. BenchmarkValueAWP – 16%$112MAC Price$85U&C$60 (excluded from logic)Copayment$10Ingredient Cost + Dispensing Fee ($2)$87Table 3: Opaque "Lesser of" Calculation Plan pays: $75 (ingredient cost only)Plan Should have paid: $50PBM pockets: $25 spread (assuming no dispensing fee spread 🙄)Problem: U&C was excluded, despite being the lowest actual price. Caveat Emptor: Copayments Must Be Part of “Lesser of” Logic The member’s copayment isn’t just a flat fee. It’s supposed to be the maximum they pay. If the ingredient cost is less than the copay, the member should pay the lesser amount. But PBMs often skip this check, allowing the member to overpay while the plan pays nothing. The technical term for this process is called a clawback. Example: Ingredient Cost: $8Member Copay: $10Proper Charge to Member: $8Charge to Plan: $0Total Paid: $8Overpayment if Copay Isn’t Adjusted: $2Who Keeps the $2? PBM or pharmacy, depending on contract setup This is a quiet but common form of margin capture. It punishes members and undermines trust in the plan. Fix: Require in your contract that member cost share be the lesser of: Flat copayCoinsurance amountTotal claim cost (ingredient + fee) That one line can stop millions in overpayments across large populations. Save Your Spot How PBMs Justify the Exclusion They may say U&C data is unreliable or inconsistent. In other cases, they quietly stop collecting or enforcing U&C pricing, allowing it to fade out of relevance. Why This Matters Over thousands of claims, this tactic inflates your drug spend without raising red flags. You’re led to believe you’re paying the lowest price, but you’re often not. What You Can Do About It Review your PBM contract. All four benchmarks, AWP – %, MAC, U&C, and copayment must be included in the lesser of logic.Request sample claims data. Spot-check random NDCs across pharmacies. Look for cases where U&C is lower than what was paid.Demand transparency. Know how…

Five ways to improve PBM procurement for clients and other notes from around the interweb: Get Certified Now! Five ways to improve PBM procurement for clients. Nearly a decade ago, plan sponsors' pharmacy benefit conversations focused mostly on member satisfaction and plan compliance. Today, fiduciary duty comes first, then member satisfaction, compliance and, of course, GLP-1s, which is why employers are counting on their benefit advisers more than ever to guide them through Rx matters. Times have changed, which begs the question, "What does it take to ensure plan sponsors meet their fiduciary duty?" Putting the pharmacy benefits manager (PBM) business "out to bid" every few years isn't enough. Given heightened scrutiny of traditional PBMs and rising Employee Retirement Income Security Act (ERISA) liability risk, plan sponsors should regularly evaluate their PBM options, prioritizing strategies that lower total costs, improve member outcomes and safeguard long-term plan sustainability. However, issuing, evaluating, and managing requests for proposals (RFPs) from PBMs can be challenging. Pharmacy in Focus Report: Navigating the GLP-1 conundrum. The pharmacy industry is at the epicenter of a worldwide transformative shift in health care. In the U.S., prescription drug spending has grown steadily to $723 billion in 2023.1 For commercial plans, Evernorth Research Institute found that prescription drug spend has seen increases ranging from 2.3% in 2019 to 8.9% in 2024. Key drivers of this trend include rising rates of chronic conditions, persistent drug price inflation and the rapid pace of pharmaceutical innovation, including expanding drug indications. In 2025 and beyond, while we anticipate a gradual tapering of the rate of spending increases, spending levels will remain high, increasing above projected inflation rates and creating a volatile environment that will continue to impact individuals, providers, plan sponsors and communities. The Future of PBMs in 2025: AI, Regulations, and Transparency Initiatives. Pharmacy benefit managers (PBMs) play a critical role in the US health care system by managing prescription drug benefits for insurers, government programs, and employers. However, the industry faces growing scrutiny over pricing transparency, rebate structures, and patient access to medications. As we move into 2025, the PBM landscape is undergoing significant transformation driven by regulatory changes, artificial intelligence (AI) integration, and transparency initiatives. In 2024, the Biden administration and Congress introduced several measures to increase PBM transparency and reduce prescription drug costs. Regulatory bodies such as the Federal Trade Commission (FTC) and Centers for Medicare & Medicaid Services (CMS) have intensified investigations into PBM pricing practices, particularly spread pricing, and rebate structures. The Endless Opportunities ChatGPT Creates for Pharmacists. With the recent rise of artificial intelligence (AI), not only in the pharmacy but across society, major players within the AI space have designed technology possible for any human being to adapt. One of the most notable examples is ChatGPT, an AI language model capable of answering straightforward questions with detailed answers. “ChatGPT is an AI language model capable of responding in straightforward language to medication-related questions,” wrote authors of a study published in the Journal of the American Pharmacists…

Medical specialty drugs are among the fastest-growing cost drivers in healthcare, demanding a more strategic approach to reimbursement. Without proper oversight, self-funded employers and plan sponsors can overpay for these high-cost therapies, leading to unnecessary financial strain. Optimizing medical specialty reimbursement presents significant opportunities for plan sponsors to reduce medical benefit drug costs while maintaining clinical effectiveness. Clinical Effectiveness Ensuring clinical effectiveness means aligning medical specialty drug reimbursement with evidence-based protocols. This requires a framework that prioritizes therapies with proven outcomes and avoids unnecessary utilization. Establishing clinical guidelines and enforcing prior authorization policies can help curb waste while ensuring patients receive the right medication at the right time. Pricing Validation: Paid vs. Billed A frequent source of waste in specialty drug reimbursement is the gap between what is billed and what is ultimately paid. Providers may bill significantly higher amounts than negotiated contract rates, leaving employers at risk of overpayment. Rigorous auditing of claims and automated pricing validation tools can help identify discrepancies and ensure plan sponsors pay only what is contractually obligated. Pricing Validation: Paid vs. Contract Beyond billed versus paid amounts, discrepancies also exist between what is paid and the contracted rate with manufacturers, PBMs, or other intermediaries. Implementing real-time pricing validation tools ensures that payments adhere to contract terms, reducing financial leakage and preventing unnecessary markups. Employers should demand transparency from their vendors and hold them accountable for contract compliance. Dose Optimization One of the most overlooked opportunities in medical specialty reimbursement is dose optimization. Many specialty drugs have flexible dosing options, yet providers often prescribe in a manner that maximizes revenue rather than efficiency. For example, if a drug is available in multiple vial sizes, using the optimal combination can reduce waste and lower costs. By requiring dose rounding policies and leveraging clinical pharmacist oversight, employers can avoid overuse and ensure cost-effective dosing strategies. Dose Optimization Example: Depending on the pharmacy, the potential for even greater savings exists Quantity Limits Implementing quantity limits on specialty medications prevents excess dispensing and waste. Specialty drugs are often high-cost, and without proper safeguards, patients may receive more medication than clinically necessary. By setting quantity limits based on FDA-approved indications and real-world utilization data, plan sponsors can minimize waste and prevent unnecessary costs. Medical Drug Rebates Rebates are a critical component of specialty drug reimbursement, yet they often remain opaque. Employers should demand full visibility into rebate agreements and ensure that all negotiated discounts are passed through. Fiduciary PBMs play a crucial role in securing transparent rebate structures that lower medical benefit drug costs while maintaining patient access to essential therapies. Medical Formulary Management A well-structured medical formulary helps steer utilization toward the most cost-effective therapies. By excluding high-cost drugs with limited clinical value and promoting biosimilars or lower-cost alternatives, formulary management can significantly reduce specialty drug spending. Employers should work with PBMs that take a fiduciary approach to formulary design, ensuring that decisions are based on clinical and financial value rather than hidden incentives. Site of Care Management Where…