Transparency. It’s a Beautiful Thing.

Discount drug card programs have been around since at least 1992 and many that still exist today were built the same way they were back then, by partnering with a pharmacy benefit manager (PBM).


Today, the buzz word is “transparency”, a kind of openness as to how everyone gets paid.

 With this, a “new breed” of pharmacy benefit vendor, a pharmacy benefit administrator (PBA), has arrived.  We have created BetterRxCard around this new concept and new administrator.  This provides the strongest kind of prescription discount card program, because it’s one that serves the best interest of patients, pharmacists and pharmacies.


“What’s a PBA, again?”


The term is described well in this excerpt to a letter to Congressmen Charles Rangel, Chairman of the Ways and Means Committee, in 2009 from the president of a PBA (read the entire letter here):


One of the best definitions of transparency in the pharmacy benefit sector was provided by David Calabrese in Managed Care Executive, dated May 1, 2006.


Transparency is a form of business practice involving full disclosure of costs and revenues, allowing the customer to make more well-informed decisions regarding purchases. In the PBM industry, transparency lays the groundwork for more simplified PBM-client business relations, more accurate financial modeling and performance metrics and a greater comfort level among PBM consumers. 'Transparency,' however, is a relative term used freely in the marketing efforts of many PBMs. The genuine commitment to transparency lies in the actual business practices the PBM invokes to support this claim. 'True transparency' is a model in which all PBM revenue streams [drug-level rebates, funding of clinical programs, administrative fees, service fees, management fees, research/educational grants, etc.] are fully disclosed to the payer; the full value of retail and mail-order pharmacy discounts is passed onto the client; data is shared with the client; and the client is given ultimate decision-making control over its drug benefit design and formulary management. It is this commitment to true transparency which has begun to differentiate newer PBMs.


“Newer” PBMs identify themselves as pharmacy benefit administrators and provide full disclosure of all fees and allow health plans to audit them. They pass through rebates to the beneficiary and share data with their health plan customers. PBAs work as administrative and advisory partners with their health plan customers, acting under their direction, and do not enforce a formulary or drive beneficiaries to mail order regardless of whether this is appropriate for them or not. The PBA value is proven and is less costly than services offered by PBMs where other conflicts between managing costs and managing profits might otherwise exist.


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