PBMs cash in on contract loopholes

Each year, PBMs swindle governments, employers and insurance companies out of big bucks by deliberately misleading clients in their contracts.

Do you know what a “branded generic” is? It’s a clever term invented by PBMs. We all think “generic” means cheaper—right? Well, yes. But, no, not when it’s a branded generic.

Say what? Exactly. It’s an intentionally misleading term in contracts that bilk unsophisticated, trusting clients.

Manipulating the way they categorize drugs enables PBMs to line their wallets by charging higher brand prices for generics, classifying generic drugs as brand drugs in order to keep rebates/kickbacks from drug manufacturers rather than passing them on to employers or insurance companies, and essentially lying about generic drug utilization rates so they can attract more customers.

Most payers are unaware of this issue until after the fact, when they find out through an audit they’ve been bamboozled. At that point, there’s little they can do to resolve it. [We need to point out that too few employers know how to audit a PBM contract. More to come on this problem!]

The large PBMs’ response to this issue is that their manipulative behavior is the industry’s standard.  Well, no kidding, if by industry standard they mean always looking for a profit on the backs of those they are supposed to serve.