PBM 101
Your transparent guide to the PBM world
Whether you’re evaluating your pharmacy benefit manager (PBM), negotiating terms or trying to reduce pharmacy spend, this hub pulls together the guides, articles and tools that make PBM decisions easier and more transparent.
PBM Fundamentals
Our pharmacy benefit solution is crafted to meet the unique needs of the people we serve.
Hover over each tile to learn how we can serve you.
It’s not enough to be transparent. That’s why we bring full clarity.
What is a pharmacy benefit manager?
How do PBMs work?
Why do PBM models matter?
The PBM model determines whether savings flow back to the plan or get retained elsewhere. Traditional and some hybrid models can make discounts and rebates look great on paper, while masking what is kept and how costs are calculated. In a pass-through model, like Navitus, all negotiated rebates and fees are returned to the plan, and the PBM is paid through a defined admin fee.
How do PBMs reduce drug costs?
Through smart formulary decisions, utilization management, pharmacy reimbursement and specialty drug strategy, they can help lower costs, generate measurable savings and improve member outcomes. Choose a PBM that makes total net cost obvious, not complicated.
Why does specialty change everything?
yet drive more than 50% of pharmacy spend.
As a result, without effective specialty management, a small number of claims can move the entire year’s budget.
PBM Fundamentals
Our pharmacy benefit solution is crafted to meet the unique needs of the people we serve.
It’s not enough to be transparent.
That’s why we bring full clarity.
Understanding PBMs is the first step toward making informed, value-driven decisions, and you shouldn’t spend hours decoding jargon to get there. Unlike traditional PBMs that profit from keeping you in the dark, Navitus was built to eliminate unnecessary complexity.
That’s why we created a clear overview of how PBMs work, where costs hide and what to expect from your PBM partner. So you can make your decisions based on clarity, not assumptions.
What is a pharmacy benefit manager?
A PBM runs the prescription drug benefit on behalf of health plans and employers.
By negotiating lower drug prices, building smart formularies and implementing cost-control strategies, PBMs help keep pharmacy spend in check while making medications more affordable and accessible for members.
How do PBMs work?
PBMs sit in the middle of the drug supply chain, connecting drug manufacturers, pharmacies and your members through contracts, formularies, coverage rules and reimbursement terms.
From this position, PBMs can lower drug costs and improve access, or add complexity that obscures who gets paid and how much.
Why do PBM models matter?
The PBM model determines whether savings flow back to the plan or get retained elsewhere.
Traditional and some hybrid models can make discounts and rebates look great on paper, while masking what is kept and how costs are calculated.
In a pass-through model, like Navitus, all negotiated rebates and fees are returned to the plan, and the PBM is paid through a defined admin fee.
How do PBMs reduce drug costs?
PBMs play a central role in managing drug costs.
Through smart formulary decisions, utilization management, pharmacy reimbursement and specialty drug strategy, they
can help lower costs, generate measurable savings and improve member outcomes.
Choose a PBM that makes total net cost obvious, not complicated.
Why does specialty change everything?
Specialty drugs are the main budget driver for most plans.
They only account for 2% of use, yet drive more than 50% of pharmacy spend.
As a result, without effective specialty management, a small number of claims can move the entire year’s budget.
Other PBMs promise transparency.
We deliver it.
For years, PBMs used complexity as a cover. Navitus was built to do the opposite: make pharmacy benefits easier to see, explain and control. With over two decades of experience, we’re a trusted and proven alternative to traditional PBMs, delivering 100% clarity, measurable client success and real-world results.
Here are some of the things we do to empower plan sponsors to control costs and deliver lasting value to their members:
- We offer total clarity. We are the first and only fully open-book PBM that delivers total clarity across our entire business model, including every dollar spent, every term agreed upon, every program delivered and every step of our relationship.
- We develop clinical programs that manage your costs for years. We don’t sell you quick financial wins only to disappoint in year two. We build programs and guide clinical decisions with you that manage trend over time to support member health while lowering costs.
- We’re designed to be your partner of choice. By listening to you, we create flexible solutions that put you and your members first. It’s all backed by over two decades of proven success and expertise.
Get the full framework: Our PBM 101 e-book covers everything you need to know about pharmacy benefit managers, from models and incentives to how rebates and spread pricing work. It’s designed to be a single source of truth you can access immediately.
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Latest Insights
Our latest insights, testimonials and more:
Get to Know the PBM Pass-through Model
In the world of pharmacy benefit management (PBM), there are multiple models a company can follow, including the pass-through, hybrid and traditional models. While all PBMs negotiate discounts and rebates with manufacturers on behalf of their clients,…
