Mark Cuban to CEOs: ‘If you’re using a Big 3 pharmacy benefits manager, you are getting ripped off. Period. End of story.’
The White House held a roundtable discussion on lowering healthcare costs last week. Fortune magazine followed up with one of the panelists, business mogul and Cost Plus Drugs cofounder Mark Cuban.
“Even though health insurance costs are the second-largest line item after payroll, CEOs don’t really understand it or know anything about it,” Cuban told the business publisher.
Fortune reports that, for his own employees, Cuban uses a “pass-through” PBM called AffirmedRx. Its business model involves collecting revenue from administrative fees instead of discounts and rebates, leaving AffirmedRx free to “pass savings along to customers” like Cuban’s companies.
“Everything we just pay for on a transactional basis, and they do what we tell them to do,” Cuban tells Fortune. “That was an easy switch.”
Fortune gave the Big 3 PBMs—CVS Caremark, Cigna’s Express Scripts and UnitedHealth’s Optum Rx—a chance to respond. Two of the three emailed comments.
CVS Caremark:
Employers, unions, health plans and government programs work with [us] precisely because we deliver for them—lower drug costs, better health outcomes and broad pharmacy access. … [W]e are the leading agent of change, innovation and transparency in the market.
Express Scripts:
Our clients choose to work with us because we offer broad flexibility and choice, the clinical expertise to ensure better health outcomes for the people they serve, and the negotiating muscle to secure savings across the thousands of brand, specialty and generic medications available today, not just a handful of generic medications.
More Cuban:
I really think we’re going to start seeing a trend for healthcare CFOs—in any company with more than 1,000 employees—where there’s somebody focused on the economics and wellness of their employees.
Other participants at the roundtable event included White House advisors Lael Brainard and Neera Tanden, FTC chair Lina Khan, HHS secretary Xavier Becerra and Cuban’s cofounder at Cost Plus Drugs, Alex Oshmyansky.
The White House’s brief summary of the discussion is here, the full video replay is here and the Fortune article is here.
Dave P. has worked in journalism, marketing and public relations for more than 30 years, frequently concentrating on hospitals, healthcare technology and Catholic communications. He has also specialized in fundraising communications, ghostwriting for CEOs of local, national and global charities, nonprofits and foundations.