At a glance
- Health care costs continue to rise, increasing pressure on employers to manage pharmacy benefit spending.
- New therapies, changing utilization, and evolving reimbursement dynamics can make pharmacy benefit costs harder to predict.
- Rebate-free pharmacy benefit models offer a more transparent approach to pharmacy benefit costs.
- Research shows many employers believe rebate-free models could improve transparency and predictability.
The health care affordability challenge is real – employer health care costs are expected to rise 9.5% this year alone.1 Equally significant, but discussed far less often, is the challenge of cost predictability, particularly when it comes to pharmacy benefits.
While many employers understand the value that rebates can provide, new therapies, changing utilization, and evolving reimbursement dynamics make it difficult to forecast what rebate-based savings will deliver months later.
A recent survey by Penta Group on behalf of Evernorth Health Services found that 82% of employers agree that rebate-based savings feel less predictable than in years past. That uncertainty can make it increasingly difficult for employers to set budgets, accurately predict costs, and plan confidently for employees.
“When I speak with employers, I hear a version of the same story every day: predictability is no longer a nice-to-have – it’s a need-to-have,” said Leslie Achter, Senior Vice President of Account Management for the Commercial Division at Express Scripts. “A rebate-free model can provide predictable, accurate, and real-time forecasting that allows employers to make confident decisions.”
Why pharmacy benefits are evolving toward rebate-free benefit models
- Pharmacy spending is becoming more difficult to forecast. New therapies entering the market, changing utilization, and a dynamic reimbursement environment are creating more uncertainty.
- More clarity is key. Traditionally, pharmacy benefit savings are measured at the plan level, through rebates and other retrospective discounts. But retrospective discounts make it hard for employers to know what they will spend ahead of time.
- Employers are looking for a clearer way to understand value. Rebate-free models remove complexity, delivering a more transparent approach to pharmacy benefit costs and savings for employers, while also making the value reaching employees easier to understand.
- Employers know predictability matters for their employees too. Employers want greater confidence in their own organizational spending and more certainty in what their employees pay at the pharmacy counter.
A clearer way to deliver pharmacy benefit value
While the pharmacy benefit industry has spent years focused on maximizing savings, rebate-free models offer a compelling alternative in today’s environment. Many employers are ready for that shift: 92% say a rebate-free model would improve transparency, and 86% believe it would improve predictability.
Leslie Achter shared additional perspective on how employers are approaching pharmacy benefit predictability in a recent LinkedIn post on pharmacy benefit planning.
Find the complete Penta Group survey findings and learn more about Evernorth Signature Pharmacy Benefit Services here.
Commonly asked questions
Express Scripts Pharmacy Benefit Services Member Experience focuses on supporting members every step of the way by putting more control and choice in their hands—making it easier for them to compare options, manage costs and access the medications they need. Our commitment to innovation is unmatched. We’re continuously evolving the pharmacy benefit experience—doing more, moving faster, and delivering greater value every single day.