Pharmacy Benefit Manager Jobs
Pharmacy benefit managers are middlemen between drug manufacturing companies and health insurance companies.
This article will look at pharmacy benefit manager jobs, what a PBM does, and where to apply for those wanting to work in the industry.
Who Is a Pharmacy Benefit Manager?
A pharmacy benefit manager can be either a company or an individual. They act as a third party between pharmaceutical companies and health insurance companies.
A PBM negotiates the costs of drugs, as well as how the public can access prescription medication. Lastly, they also determine how much payment a pharmacy will receive.
A PBM works closely with the healthcare insurance provider. They handle patient insurance benefits for certain health plans or employers. They can also pay out prescription medication claims.
The role of pharmacy benefit managers
A pharmacy benefit manager is an essential part of the pharmacy team.
They are not directly involved in distributing medications to patients like pharmacy technicians. Pharmacy benefit management involves negotiating the cost of medications and payments. This negotiation is between drug manufacturers and healthcare insurance companies. And ultimately, it is assisting members.
PBMs work with:
- Medication manufacturers
- Health insurance companies
- Drug wholesalers
Pharmaceutical manufacturers pay rebates to PBMs. PBMs also pay pharmacies on behalf of insurance companies for drugs that the insurance provider dispenses.
PBMs are primarily responsible for:
- Maintaining formularies (prescription medication lists)
- Negotiating rebates
- Processing claims
- Performing drug use reviews
- Managing medication distribution for pharmacies
- Overseeing patient compliance
- Updating applicable patient management software
The objectives of pharmacy benefit management
There are two main objectives of pharmacy benefit management.
- Pharmacy benefit plans: The aim of these plans is to reduce spending on medication. PBMs negotiate the costs of drugs. They can also directly buy drugs from manufacturers. PBMs can then offer medication to plan members or employers at competitive prices.
- Access to medication: A pharmacy manager working in this setting can negotiate access to medication. This is done by working with manufacturers and wholesale companies. This means that patients (plan members) can get affordable access to the medications they need.
The cost of prescription medication and PBMs
PBMs are in the middle of the distribution chain. It is no surprise that they play a role in the spending on prescription medication.
That is because PBMs:
- Develop and maintain formularies. These are lists of prescription medications that are covered by insurance plans. This means they have a say in what patients must pay out-of-pocket for.
- They can negotiate discounts and rebates from pharmaceutical manufacturers.
- They may be contracted directly to specific pharmacies. They can then be reimbursed for medications dispensed to plan members.
Where to Find a Pharmacy Benefit Manager Job
Below are the best places to start looking for pharmacy benefit manager jobs
Few people are qualified to be a pharmacy benefit manager. There are also not a lot of jobs.
Job portals are a good place to seek employment. These online job boards allow candidates to filter by location, experience required, and payscale.
LinkedIn, Zip Recruiter, and Indeed are great online job portals. Candidates can set a job alert for their desired position and receive emails for the latest job alert.
Network and connect
Oftentimes it is more about who you know than what you know. Networking is an important part of finding a pharmacy manager job.
It is important that the candidate remains in contact with the people they met during their internships or externships.
LinkedIn is a great method to remain in contact with potential employers in a professional way.
How Much Are Pharmacy Managers Paid?
A Pharmacy Manager working with insurance companies earns an estimated total pay of $140,897 per year. The average salary is $127,497 and the rest is additional pay. Additional pay includes commission, profit sharing, or cash bonuses.
PBMs are often also offered a comprehensive benefits package. This comprehensive benefits package will include medical, dental, and vision insurance.
Note: not all job postings will offer this comprehensive benefits package.
How Pharmacy Benefit Managers Work
Working with pharmaceutical manufacturers
PBMs and medication manufacturers have a complicated relationship.
PBMs are middlemen between pharmaceutical companies and insurance plan members (or patients). They determine medication’s affordability and help members access medications through certain programs:
1. Drug rebates
PBMs communicate directly with drug manufacturers. They then determine the rebates that the manufacturer will pay the PBM for medications.
The PBM will then pass some, all, or none of the rebates on to the employer.
A formulary is a list of medications that are covered by a certain insurance plan.
This list is curated by the pharmacy manager. It includes medical drugs that are affordable and effective.
When a certain medication is included in a formulary, physicians are more likely to prescribe it.
3. Prior authorization
Prior authorization plans are certain cost-saving features of healthcare plans. The aim is to ensure that members use prescription drugs appropriately.
PBMs are responsible for curating lists of drugs that require prior authorization. Should a patient require one of these drugs, they will require prior approval before the healthcare insurer agrees to cover the cost of the drug.
4. Step therapy
Step therapy is similar to prior authorization, but it also applies to specialty drugs.
These programs aim to ensure that patients first use a more affordable drug for a specific condition. Only if that drug did not work are patients allowed to move on to more expensive medication.
Working with employers
Employers can sign contracts with PBMs. The PBM will then curate and manage a pharmacy benefits plan. This contract is typically for three years.
The plan will include deductibles, clinical programs, and co-payments.
Once the plan is set up, the employer will trust the PBM to manage any benefits and also relay information to employees about what is covered.
The contract stipulates the responsibilities of the PBM, which include:
1. Processing claims
PBMs will have to process and pay any prescription medication claims included in the benefits plan.
2. Reimbursing rebates
PBMs are responsible for negotiating rebates with medication manufacturers. Rebate programs can be very complicated. A PBM must understand these programs and administer the rebates.
It will depend on the contract, but all, none, or some of the rebates will go to the employer.
3. Clinical programs
PBMs are responsible for monitoring clinical programs. They must adjust the health benefits of these programs while still managing costs.
Clinical programs include step therapy and prior authorization, as mentioned above.
The aim of these programs is to provide patients (in this case, employees) with the best possible care.
4. Reviewing drug utilization
PBMs, in essence, act as safety officers for pharmacy benefits plans.
Drug utilization programs review the effectiveness and safety of specific medications. PBMs have access to patients’ medical history. This means they’re aware of potentially dangerous drug interactions when prescriptions are mixed.
How do you become a pharmacy benefit manager?
It is no easy feat to become a pharmacy benefit manager.
You will require an applicable bachelor’s degree. After that, candidates must have a minimum of five years working as a pharmacist. Five years working in pharmaceutical management with healthcare plans are also desired. Lastly, a doctorate degree is preferred.
Who are the biggest pharmacy benefit managers?
The biggest companies that offer PBM services are OptumRx, CVS Caremark, and Express Scripts.
How do pharmacy benefit managers make money?
PBMs are paid by insurance companies to manage the cost of medications. They also receive rebates from pharmaceutical manufacturers.
A PBM can have a thankless job. They are constantly entering negotiations. PBMs have to consider insurance companies, plan members, employers, pharmacies, and medication manufacturers.
Finding a job as a pharmacy benefit manager can be challenging, but the salary and comprehensive benefits make it worth it.