Top 3 Things You’ll Learn
- Developments in the pharmacy benefit management industry by decade
- When mail order pharmacies became an option for plan sponsors
- How and when specialty drugs emerged in the market
The prescription benefits landscape has changed drastically over the last two decades. As we approach the end of RxBenefits’ 25th year in the pharmacy benefits space, we are looking back at some of the more pivotal moments in the industry’s more than 50-year history. As you browse through the list, click the links to read more about some of these key moments in the pharmacy benefit management industry’s history.
1970s
- Health plans cover prescription drug benefits
- First pharmacy benefits manager (PBM) uses plastic benefit card, and paper claim adjudication begins
- Pharmacy benefit program is part of major medical benefits
1980s
- Health plans move away from internal pharmacy management programs
- First mail-order pharmacies offer 90-day maintenance medications at reduced prices
- Early PBMs offer no discounts at retail; a small PBM called Express Scripts negotiates first discounts
- PBMs manage Rx benefits for 60 million people
- Average prescription drug utilization: 4 Rxs per member per year (PMPY)
1990s
- Real-time electronic claims processing and eligibility verification at the point-of-sale
- New technology allows duplication of generic drugs by multiple pharmaceutical manufacturers
- New brand-name drug products racing to the market
- PBMs manage Rx benefits for 100 million people
Download the 25 Major Moments in the History of Pharmacy Benefits
2000s
- Emerging high-cost specialty drugs treat complex diseases
- Four PBMs control more than two-thirds of the market, covering 80% of Rxs
- Healthcare reform begins
- PBMs manage Rx benefits for more than 200 million people
2010s
- Prescription drug spending soars as specialty drugs and chronic medications represent $0.65 of every pharmacy dollar
- Three PBMs control 73% of the market: Express Scripts, CVS/Caremark, and OptumRx
- Top prescription benefit managers and medical carriers create vertically integrated insurers
- PBMs manage Rx benefits for more than 250 million people
2020s
- Pharmacy Benefits Optimizer (PBO) category officially launches in the employee benefits market
- Specialty Rx accounts for nearly 50% of pharmacy spending
- Increasing scrutiny on PBMs’ role in drug pricing transparency
- Generic drug dispensing rates of 90%+
- Average prescription drug utilization: 10 Rxs PMPY
Download the timeline: 25 Major Moments in the History of Pharmacy Benefits
Check out our free Guide to Optimizing Pharmacy Benefits to learn best practice strategies to manage pharmacy benefits while improving the benefit value for self-funded employers and their members.
