1. Troy Wieck, ASA, MAAA Sr. Director, Actuarial Services March 20, 2018
The PBM Chain: How the PBM, Pharmacy, Wholesaler, Doctor and Plan Interconnect
Troy Wieck, ASA, MAAA
Sr. Director, Actuarial Services
March 20, 2018
©2018 CVS Health and/or one of its affiliates

2. The Stakeholders PBM Member Plan Pharmacy Doctor Manufacturer
Wholesaler
Government

3. PBM and Member Coordinate Benefits Relay Drug Price Relay Benefit
Insurance Cards
Letters and Communications
Clinical Outreach
Provide information regarding lower prices

4. PBM and Plan Negotiate drug costs Clinical Programs Drug Adjudication
Pharmacies and Manufacturers
Client Traditional and Transparent
Clinical Programs
Drug Adjudication
Compliance
Consultation on:
Formulary
Plan Design
Bids

5. PBM and Pharmacy Negotiate Drug Costs Relay Plan Benefit
Networks:
Broad
Narrow
Performance
Relay Plan Benefit
Measure Performance

6. PBM and Doctor Education Utilization Management Formulary Benefits
Drug Costs
Utilization Management

7. PBM and Manufacturer Negotiate Rebates Base Rebate Admin Fees
Price Protection
Competition between competitors to obtain favorable formulary status

8. PBM and Wholesaler Obtain current wholesale price
Used to negotiate drug costs
Purchase Drugs for Mail Order
90% of drugs distributed by AmerisourceBergen, Cardinal Health, McKesson

9. PBM and Government Medicare Medicaid Exchanges Compliance Education
Pricing/Filing/Bids
Formulary
Data
Regulations
Education
Note: PBM’s interact with govenrnents on client’s behalf.

10. Q&A