Is Your Pharmacy Benefit Still Working as Intended?

4 Min read
September 3, 2026

Shane Garduno

VP Account Management

Best Practices

A pharmacy benefit can perform exactly as designed and still fall behind the market.

The contract may be meeting its guarantees. Claims may be processing correctly. Members may not be raising widespread concerns. Those signs matter, but they do not necessarily mean the strategy is still producing the best result.

Pharmacy changes quickly. New therapies, shifting evidence, changing prices, and expanded biosimilar options can reshape an employer’s spending in a short period.

Milliman estimates that pharmacy will be the fastest-growing component of employer-sponsored healthcare costs in 2026, rising 14.8% for the average person in its modeled plan. Pharmacy and outpatient facility care are expected to account for 69% of the annual increase.¹

Employers are responding by looking more closely at their PBM relationships. In the National Alliance of Healthcare Purchaser Coalitions’ 2026 survey, the share of respondents using one of the three largest PBMs fell from 63.4% in 2025 to 54.3% in 2026.

Forty-three percent of employers overall said they were considering a PBM change within the next one to three years.²

That does not mean every employer needs to change its PBM. It means every employer needs a current reason for staying with the strategy it has.

A review is not the same as an RFP

Reevaluating a pharmacy benefit does not have to begin with a search for a replacement. It begins with a simpler question:

Is the benefit still working as intended for the plan and its members?

The answer may confirm that the current PBM remains the right partner. It may also uncover a formulary change, contract issue, or cost driver that deserves attention.

A useful review separates the decision to evaluate from the decision to change. Staying can be the right choice. It should be an informed one.

Understand what is driving cost

Most employers know whether pharmacy spending increased. Fewer can explain precisely why.

A broad trend number can hide very different developments. Specialty use may be rising. One high-cost therapy may be driving much of the increase. GLP-1 use may be expanding. A lower-cost biosimilar may not be gaining expected adoption. A formulary decision may favor a larger rebate instead of a lower final net cost.

Each cause points to a different action.

Reporting should do more than summarize what the plan spent last quarter. It should identify the therapies, populations, channels, and benefit decisions driving the result.

The most useful information answers three questions:

What changed?
Why did it change?
What can the employer do next?

Without those answers, a plan sponsor may receive more data without gaining greater control.

Look at the benefit through the member’s experience

A contract can perform well on paper while members experience friction in practice.

People feel the benefit when an authorization takes longer than expected, when a specialty medication requires several handoffs, or when the amount due at the pharmacy is different from what they anticipated.

One delayed refill may appear to be a service issue. For the member, it may mean an interruption in treatment.

A regular review should examine whether members can understand their coverage and costs, begin clinically appropriate therapy without avoidable delays, and get help when a prescription requires more coordination.

Coverage and access are related, but they are not the same. A medication can appear on the formulary and still be difficult to receive.

The employer needs enough information to see where barriers are occurring and whether the responsible partner is resolving them.

Define the review before it begins

A useful review starts with the employer’s goals.

Depending on the plan, the review may examine final net cost, member out-of-pocket cost, time to therapy, biosimilar adoption, continuity of treatment, and resolution of access barriers.

Each measure should have a clear definition and comparison period. The employer should also understand who is responsible for acting when the review identifies an issue.

The goal is not a longer scorecard. It is a clear answer to whether the current strategy is delivering the results the employer expects.

Check whether the current design still fits

A plan designed several years ago may not reflect new indications, pricing, evidence, or biosimilar options.

The review should test whether the formulary, clinical criteria, specialty channel, and member-support processes still fit the employer’s goals. It should also show which changes can be made within the current relationship.

Can the formulary change when a clinically appropriate lower-cost option becomes available? Can clinical criteria be updated as evidence changes? Can the specialty channel be reevaluated when another option may produce a better result?

Adaptability does not mean constant disruption. It means the plan can respond when the evidence supports a different decision.

Make renewal an active decision

A deeper review may be warranted when spending materially exceeds expectations, final net cost cannot be evaluated, audit rights remain unclear, members repeatedly experience access problems, or important opportunities remain unresolved.

No single trigger automatically means the PBM relationship should end. It means the employer should understand the cause, the available options, and the consequence of doing nothing.

That scrutiny is becoming more common. Among employers currently using one of the three largest PBMs, 55.7% told the National Alliance they were considering a change within the next one to three years, compared with 31.1% of employers using other PBMs.²

Considering a change is not the same as deciding to make one. But it is a useful reminder that renewal should be evaluated with the same discipline as replacement.

Changing a PBM requires careful planning across members, pharmacies, prescribers, internal teams, data, formularies, and communications. That is a reason to evaluate carefully. It is not a reason to avoid evaluation.

A useful review should end with one of three decisions: keep the current strategy, make targeted improvements within the current relationship, or begin a formal market review.

Each decision should have a clear owner and timeline. When a change is approved, the employer should also define how it will know whether the change worked.

Pharmacy benefits are too important to manage on autopilot. Employers do not need to chase every new model or reconsider their PBM every time the market changes. They do need a regular process for examining what is working, what has changed, and where action may be necessary.

Sometimes that process leads to change. Sometimes it creates greater confidence in the decision to stay.

Both are signs that the pharmacy benefit is being managed intentionally.

Sources

¹ Milliman. “2026 Milliman Medical Index.” May 2026. The index measures total healthcare cost for a typical employer-sponsored plan, not only the employer-paid share.

² National Alliance of Healthcare Purchaser Coalitions. “Pulse of the Purchaser 2026 Survey Results,” August 11, 2026; and “Employers with Claims Data Access Take More Action on Healthcare Costs, National Alliance Survey Finds,” August 12, 2026.

Is Your Pharmacy Benefit Still Working as Intended?

4 Min read

Shane Garduno

A review is not the same as an RFP

Understand what is driving cost

Look at the benefit through the member’s experience

Define the review before it begins

Check whether the current design still fits

Make renewal an active decision

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