Benefit management, pharmacy contracting

Kreling, D. H., T. Collins, H. Lipton, and K.C. Hertz. 1996. Assessing the Impact of Pharmacy Benefit Managers. HCFA Contract Report, HCFA 95-023/PW, September 30. 

Many third parties hire pharmacy benefit managers (PBMs) to provide prescription claims processing and other services. Examples of third parties that hire PBMs are insurance companies, employers, Medicare prescription drug plans, and state Medicaid programs. PBMs establish pharmacy networks as part of their claims management services, so many pharmacy third-party contracts are with PBMs. Examples of other ser-... 

Another pharmacy benefits management service is the creation and management of pharmacy networks. These networks consist of outpatient pharmacies under contract to MCOs and/or their contractual PBM partners to provide drug services, typically at a negotiated, discounted fee. PBMs have reported that drug cost savings for their clients have been achieved, in part, by use of discounted fees for pharmacies in their networks [3,8]. 

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