Benefits advisors are expected to bring clarity to clients’ most complex and costly challenges, and pharmacy benefits often sit at the top of that list. While proposals may appear straightforward, the reality is often buried in the fine print: hidden fees, spread pricing, and vague rebate arrangements that can quietly drive costs higher.
Transparency is not just a selling point. It is the difference between a contract that protects your client’s budget and members, and one that locks them into overspending with little recourse.
Here are five questions to help test the transparency of any pharmacy plan.
1. How are rebates handled, and who benefits?
Rebates are a powerful lever in pharmacy spend management, but it’s important to understand their impact on a plan’s bottom line. Do all rebates flow directly back to the plan, or does the pharmacy benefits manager (PBM) retain a portion? Are rebates disclosed at the drug level, or only in an aggregate report?
Transparency means clear, auditable answers that your clients can trust.
2. Is pricing based on what pharmacies are actually paid?
Opaque pricing models can inflate costs in ways clients may never see. Misaligned incentives can occur if plans are based on block averages instead of actual, drug-level costs. This can be an inflated benchmark. Additionally, a common practice called spread pricing can see employers charged more than what pharmacies are paid to dispense a medication.
Transparent contracts use pass-through pricing tied to actual pharmacy costs, ensuring employers pay for drugs, not markups.
3. Who oversees the clinical programs and whose interests do they serve?
Clinical management can be the difference between safe, appropriate therapy and costly waste. But the real measure of value is whether those programs are aligned with the client’s goals. Are clinical decisions being made with the plan’s cost, member safety, and long-term sustainability in mind?
Independent, pharmacist-led management that is aligned with the client’s priorities ensures the focus stays on delivering the right drug to the right member at the right time, supporting both better outcomes and financial stewardship.
4. What level of reporting will the client receive?
Visibility is non-negotiable. Advisors should ask what kind of data will be provided and at what frequency. Are reports detailed at the drug level, showing exactly where dollars are going, or are they presented as broad, consolidated summaries?
Transparent reporting empowers you to guide clients with confidence, armed with actionable insight rather than surface-level snapshots.
5. What guarantees are in place, and how are they enforced?
Guarantees only matter if they are specific, measurable, and enforceable. Consider whether promised performance or pricing guarantees are actually being delivered, and what steps are in place to reconcile any shortcomings. Advisors should look for contract language that ties guarantees to financial accountability, giving clients assurance that promises will translate into real results.
State lawmakers are stepping in to take measures they feel are needed to help reduce prescription drug costs. Collectively, most of the state-level bills are aiming to address five key areas:
Why it matters
For benefits advisors, opaque PBM contracts present both a challenge and an opportunity. Left unchecked, they can erode client budgets and trust. Addressed head-on, they position you as a strategic partner who delivers clarity and measurable value.
Transparency is the foundation of smarter pharmacy benefits management. It enables you to align contracts with client goals, hold vendors accountable, and demonstrate leadership in an area that too often leaves employers in the dark.
Want to go deeper?
Listen to the latest episode of Pharmland, where RxBenefits experts unpack opaque practices and make the case for transparency in pharmacy benefits.
