Where’s Your Money Going?
Imagine walking into Kohl’s, buying a cart full of clothes, and racking up a ton of Kohl’s Cash. But when you go to use it? Surprise—someone else already spent it. You never even saw it. Frustrating, right? Now, scale that up to millions of dollars in your health plan.
That’s exactly what’s happening with PBM rebates. Health plan sponsors expect that rebate money is being applied to offset costs, but thanks to the tight-knit relationship between PBMs and insurers, the reality is far different. The rebates exist, but they rarely, if ever, make it back to the health plan itself. Instead, they’re quietly absorbed into a black hole of insurer and PBM profits.
But wait! RXDC reporting to the federal government now requires these numbers to be disclosed. So surely plan sponsors are seeing them now, right?
Not so fast. PBMs and insurers are filing the reports—but not giving employers access to the actual data. And this is happening despite their contractual attestations that there are no gag clauses preventing disclosure. Guess what? That’s a direct violation of federal law.
But here’s the real kicker: They’re not on the hook—you are.
If you don’t have access to your claims data, can’t see your PBM contracts, and your vendors are blocking transparency, you’re in a prohibited transaction as a fiduciary. The law doesn’t go after the PBMs or insurers—it goes after you, the employer, for failing to uphold your fiduciary duty.
And unlike Kohl’s Cash, which can only be used at Kohl’s, PBM rebate dollars don’t need to go toward more drugs. That money belongs to you as plan assets. It can be used to lower premiums, reduce out-of-pocket costs, or invest in better benefits for your employees. Yet, if you don’t even know the rebates exist, how can you ensure they’re being used appropriately?
How does this apply in the real world? Last year, during negotiations for one of our clients, we were able to offset a $7 million increase—just by asking the right questions. And this was just one of many questions we asked. That’s the power of knowing your data, demanding transparency, and refusing to accept the status quo.
So ask yourself: Do you really know where your rebate dollars are going? Or is your plan unknowingly subsidizing someone else’s bottom line?
If you’re unsure, it’s time to demand answers. Because the rules are clear, and the money belongs to your plan—not them.
#WeFixYourHealthcare #PBMRebates #Transparency #FiduciaryDuty #KnowYourData
View the original LinkedIn post here.
