Pharmacy benefit managers (PBMs) will save U.S. consumers and payers almost $2 trillion in prescription drug costs—a 35% savings—over the next decade, according to new research from Visante, a consulting firm.
The research also indicates that another $550 billion could be saved if payers used the full array of savings tools that PBMs offer.
“PBMs are the one industry in America to have met the three-fold challenge posed by a generation of policymakers and consumer advocates: to simultaneously reduce costs, expand access and improve the quality of health benefits,” says Mark Merritt, president and CEO, Pharmaceutical Care Management Association. “PBMs also empower businesses to create jobs. When PBMs save employers even 1% in prescription drug costs, businesses can re-deploy that savings to cover the cost of 20,000 jobs.”
Major findings from the Visante study:
Average PBM savings
From 2012 to 2021, PBMs will save plan sponsors and consumers almost $2 trillion, or about 35%, compared with drug expenditures made without pharmacy benefit management. Of the $2 trillion, commercial plan sponsors and their members will save $1.3 trillion; Medicare Part D and its beneficiaries, $700 billion.
Range of PBM savings
Available PBM savings for individual plan sponsors can range from 20% for those that make limited use of PBM tools to 50% for those that adopt best practices recommended by PBMs.
Additional savings with best practices
If all plan sponsors adopt PBM-recommended best practices, projected prescription drug expenditures could fall by an additional $550 billion over the next decade. Of the $550 billion in additional PBM savings, commercial plan sponsors and their members could save $360 billion; Medicare Part D and its beneficiaries, $190 billion.
PBM savings and jobs
Annual savings generated by PBMs for the commercial sector will cover the cost of more than 700,000 jobs in 2012. By adopting PBM-recommended best practices, commercial plan sponsors could cover the cost of more than 200,000 additional jobs next year. If PBM tools are limited, lost savings to the commercial sector could equal the cost of more than 200,000 jobs.