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Pharmacy Benefit Manager (PBM)

Written by Stephanie M. Nixon, PhD, CCC-SLP on .

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A Pharmacy Benefit Manager is the “middleman” between your health insurance company, pharmacy, and the companies making the prescription medicaitons.

Your health insurance company is the “boss” who pays the overall medical bills, but your PBM is the specialized manager your insurance hires to do everything related to prescription medications.

They decide what medications are covered. These lists are called “formularies” that your plan will pay for and the “tier” the drug is on. The tier determines your copay.

They negotiate pricing with drug manufacturers to get discounts and “rebates” on medications.

They choose your pharmacies where you are allowed to get your medications.

They process the transaction. Meaning their computer system calculates your copay and tells the pharmacy how much they will be paid.

They make the rules for medications. They put in requirements like “Prior Authorizations” (where your provider needs to prove you need a drug before they pay for it) or “Step Therapy” (forcing you to try a cheaper drug before they approve an expensive one.

The big 3 PBMs in the US: CVS Caremark, Express Scripts, and Optum Rx.

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Stephanie M. Nixon, PhD, CCC-SLP

With a unique perspective shaped by my own learning disabilities, including ADHD, I bring a wealth of professional expertise in education and health policy, grant review, as well as research, evaluation, and treatment of children with speech, language, and reading disorders. My passion lies in advocating for those who are not able to do so for themselves, leveraging my diverse background – both personally and professionally – to make a meaningful impact in the field of special education and child development.