PBM Vendor Selection & Leveraging

Prescription drugs represent the most complicated segment within the US’s $3.5 trillion healthcare market, in large part due to Prescription Benefit Managers (PBM). Often, PBMs engage in tactics that benefit themselves while the health system does not see that same value.

This practice can often be misleading: many Health Systems may not even be aware of the true cost of their PBM vendors. This is especially true when considering rebate arbitrage, in which the PBM pockets the difference in savings between the Average Wholesale Price (which the employer pays) and Maximum Allowable Charge, for which the pharmacy is reimbursed.

Progressive can use data to determine the true cost of these partnerships and work with health systems to improve their positioning and leverage. Health systems can hone and market their service offerings to local employers by first ensuring that their own employer programs operate efficiently and generate superior clinical, service, and financial outcomes. This involves aligning and managing disparate benefits vendors, e.g., health plans and PBMs to achieve employers’ goals.

A key driver of success is establishing a “provider-driven medical director” of the employer’s health plan, which Progressive can either help the employer secure at the local level or we can provide the services ourselves. The medical director facilitates program design, management, and operation to both achieve and report on employer-specific target outcomes. Progressive is able to complete analyses to inform decisions on how to create or hone an existing structure and demonstrate appropriate results for use in local employer marketing.

In most cases, Progressive can accomplish this in as few as six to twelve months.