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PBMs: The “Tapeworm” Revealed
Warren Buffett famously said that medical spending was the “tapeworm” of the American economy. Many a tree has been killed demonstrating this point, but there has never been a single one-page image that would sear it into everyone’s mind, and rally the entire employer community behind the idea that there has to be a better way.
Until now. Here it is.
Source: Buried in something called Drug Channels.
There may be a few buyers who have generic insulin on the formulary, but there are plenty that don’t:
There you have it: the shock-the-conscience unveiling of the Tapeworm (the pink), as far as drugs are concerned. This is just one drug, but this process likely repeats many many times for many generic drugs. How is it that the process of distributing a drug and tracking who buys it sucks up much more of the value chain than actually making it?
How is it that the price paid of a container of generic Ambien can range from $3.25 (Drexi) to $136 (CVS)?
Speaking of scams…
Don’t get us started on wellness.
Balance (surprise) billing is Quizzify’s favorite scam.
Even though, according to the New York Times and others, we actually solved the problem (for non-elective surprise bills), most employers — like with PBM markups — don’t realize they have a problem in the first place. They are simply picking up most of the tab without noticing something amiss. Sort of like ET hiding in the stuffed animals.
Crooked PBMs, wellness vendors and providers…
The problem is that, for all the complaints about spending, employers how easy it is to solve these problems. Alternatives to PBMs are easy to come by. And swap out wellness for Quizzify, and put the Quizzify surprise billing language on every insurance card.