Dumping the pharmacy benefit manager

If I wrote what I think about the U.S. drug procurement “system,” the TMF computer would shut me down right away. Suffice it to say that it is opaque, expensive and a rip-off. Pharmacy benefit managers are a big part of the problem.

I have several prescriptions. Even though I have Medicare Part D coverage, I get paper prescriptions and carefully shop for the best price. I compare GoodRx and Blink Health as well as Amazon’s new prescription drug service. It’s amazing how much difference there is in pricing. Depending on the drug, I sometimes use my Part D coverage, sometimes not.

Now a major health insurer is doing the same. Can this be the beginning of the end for pharmacy benefit managers? The impact could be huge on the Macro economy as well as the stock prices of the PBMs.

A Big Health Insurer Is Ripping Up the Playbook on Drug Pricing

Blue Shield of California says it aims to save millions on drug costs, and plans to drop CVS Caremark as pharmacy-benefit manager


Anna Wilde Mathews, The Wall Street Journal, Updated Aug. 17, 2023

A major health insurer says it will jettison the complicated system that Americans use to pay for drugs, and create something that aims to be better, with partners including Amazon.com AMZN -0.38%decrease; red down pointing triangle

and the entrepreneur Mark Cuban.

Blue Shield of California said it is dropping CVS Health’s CVS 0.38%increase; green up pointing triangle

Caremark, the pharmacy-benefit manager it currently uses, which negotiates drug prices and wraps in other services such as a mail-order pharmacy.

Instead, Blue Shield, a nonprofit health plan with about 4.8 million members, will work with a selection of companies that each perform a designated function. Amazon will offer at-home drug delivery. Cuban said Mark Cuban Cost Plus Drug Company will provide access to low-cost medications, including through retail pharmacies. Another company, Abarca, will process drug claims.

Blue Shield said that, working with its partners, it aims to negotiate prices with pharmaceutical makers in a way that is different from the typical approach—with a simple net price structure that is supposed to eliminate rebates and hidden fees… [end quote]

Since this is new, it’s hard to say whether there will actually be cost savings for Blue Shield.

As for METARs, we can optimize our own situations.


The federal govt has already started doing that by setting maximum prices for some drugs. Insulin is one that just got price regulated.

Fast-acting insulin (Novolog, Humalog, etc) was targeted (to be $35/mo from $400-$800/mo), but one-shot/day insulin (Lantus, Basaglar, etc) has also seen massive price cuts (from $400+/mo to $72/box of 5 pens) starting in 2024.

It will be interesting to see what premiums, drug co-pays, and at which point insurance companies will determine is the “catastrophic” level for 2024. IMO, lower premiums because the costs will come substantially for these drugs. But the cost of “everything else” will be cited as having offset those savings–so no real cut premiums. Well, the insurance company is trying to keep their fat margins, but it may not fly.


The current system is quite simply malevolently abusive, evil, parasitic, and contributes almost nothing but confusion, dismay, and rage. The piece of the “system” I most hate is that the pharmaceutical companies and powers who created this also created and pay for a ludicrous supposedly “charitable” system that patients could apply to (begging) for aid, all designed to maximize the skim from payers while tamping down “revolutionary” tendencies of taxpayer/patients being ripped. My HIV drugs often were part of the racket. Yes, I often had to go to my meditation corner and work very hard… before going to pick up my drugs.

Unfortunately, this is VERY typical of the USAian atrocity we call the Health Care System. It is proof that our government is not anywhere near democratic, nor even under the control of a “natural aristocracy” with the interests of “their” Republic at heart.

david fb


A little late to the party. I found this as I was looking for the definition of PBMs that I wrote so many years ago.
If you want to know more about the topic there’s no better resource than Adam Fein and his Drug Channels blog.