10 Pharmacy Questions Employers that Self and Level Fund Their Health Benefits Should Ask Before Renewal

Renewal pressure starts to make more sense when employers ask better PBM questions

Table of Contents

1. Why PBM questions belong in the renewal conversation
2. What percentage of total plan spend is tied to pharmacy?
3. Which drugs are driving the highest pharmacy costs?
4. How much specialty drug spend is running through the pharmacy benefit?
5. Are specialty medications also showing up under the medical benefit?
6. How are rebates, discounts, and savings handled?
7. Can the PBM show which medications are driving the increase?
8. How are employees supported when prescriptions are expensive or confusing?
9. Are there lower-cost sourcing opportunities for high-cost medications?
10. What happens when an employee cannot afford their medication?
11. What should employers ask before accepting the renewal?
12. Before accepting the renewal, ask for a clearer pharmacy review
13. Key Takeaways

Why PBM questions belong in the renewal conversation

When renewal numbers start climbing, most employers look at the total increase first.

That makes sense because the number is usually the first thing everyone sees.

The harder part is understanding what is sitting underneath that increase. Pharmacy spend can be one of the biggest pieces of the conversation, especially for self-funded and level-funded employers that are closer to their own claims activity.

A recent Mercer report found that average health benefit cost per employee increased 6.0%, with another 6.7% increase projected for the following plan year. Prescription drug spending, including GLP-1 utilization, was also named as a key cost driver.¹

That is why the PBM conversation needs to get specific.

A PBM should be able to explain what changed in plain language. You should be able to see which medications are driving costs, how rebates are handled, where specialty drugs are showing up, and whether employees are getting help before cost becomes a barrier.

Here are 10 PBM questions to ask before accepting another renewal increase.

What percentage of total plan spend is tied to pharmacy?

The first question should be simple:

How much of the plan’s total cost is coming from prescription drugs?

Employers need this number before they can judge whether pharmacy is being actively managed. A plan may have pressure coming from medical claims, pharmacy claims, or both.

If pharmacy is a large part of the increase, the renewal review should show more than total drug spend. It should show whether the increase came from higher prices, more prescriptions, new high-cost claimants, specialty medications, GLP-1 utilization, or repeated fills that were never reviewed for lower-cost options.

Ask for:

• Pharmacy spend as a percentage of total plan spend
• Current pharmacy spend compared to the prior year
• Trend, claims volume, and high-cost claimants
• The increase by drug, category, and member type

If the answer stays at the total-spend level, you still do not have enough information to understand what happened.

Which drugs are driving the highest pharmacy costs?

Employers should ask for a list of the highest-cost drugs on the plan.

A total pharmacy number does not tell you which medications created the pressure. The answer may include specialty medications, GLP-1s, chronic condition drugs, rare disease therapies, or medications with limited alternatives.

A useful report should show the actual medications behind the spend.

Ask:

• What are the top 10 drugs by total plan cost?
• How many members are using those drugs?
• Are costs rising because of price, utilization, or both?
• Are lower-cost options available for any of those medications?
• Are employees staying adherent to chronic medications?

This is where the renewal conversation becomes more useful. If one medication cost the plan $200,000 and was used by two members, you should know that. If another drug increased because more employees started treatment, you should know that too.

The answer should give employers a clear view of what changed and what needs to be reviewed next.

How much specialty drug spend is running through the pharmacy benefit?

Specialty drugs need a separate conversation.

They can carry high monthly costs, require special handling, and create confusion for employees who need help starting or staying on treatment. For employers reviewing renewal, specialty spend should not sit inside one broad pharmacy total.

Ask how much of the pharmacy spend is tied to specialty medications.

Then ask which conditions are driving that spend. A plan with specialty costs tied to autoimmune conditions may need a different review than a plan seeing costs from oncology, fertility, rare disease, or inflammatory conditions.

Ask:

• What percentage of pharmacy spend is specialty?
• Which specialty medications are the highest cost?
• How many members are using specialty drugs?
• Are there biosimilar or lower-cost sourcing opportunities?
• How often is specialty spend reviewed?
• Does the PBM provide member support for specialty medication access?

Specialty spend can be hard to manage when the plan only sees it after claims have already been paid. Employers should ask whether high-cost specialty claims are reviewed before the same cost repeats month after month.

Are specialty medications also showing up under the medical benefit?

Some high-cost medications may be billed through the medical benefit instead of the pharmacy benefit.

That can happen with infusion drugs, provider-administered medications, and certain specialty therapies. When this happens, the pharmacy report may not show the full medication cost picture.

This can create a blind spot during renewal review. An employer may think pharmacy spend is only coming through the PBM report while other medication costs are sitting inside medical claims.

Ask:

• Are any specialty medications being billed through medical claims?
• Are infusion drugs included in the review?
• Is the employer seeing the full cost of specialty medications across the plan?
• Can the PBM, TPA, or advisor help connect pharmacy and medical data?
• Are the same medication categories appearing in both places?

A clean review should show where medications are being paid, not just which side processed the claim.

How are rebates, discounts, and savings handled?

Employers should know what happens to rebates, discounts, and savings.

This does not need to turn into a heavy contract discussion. The basic question is simple: when savings exist, can the employer see them clearly?

Ask whether rebates are passed back to the employer. Ask when they are paid. Ask whether rebate amounts are estimated, delayed, retained, or shown clearly in reporting.

The same goes for discounts and savings. If a PBM says the plan saved money, the employer should be able to see where that savings came from.

Ask:

• Are rebates passed back to the employer?
• When are rebates paid?
• Are rebates shown clearly in reporting?
• Are discounts visible at the drug level?
• Are savings reducing plan costs, employee costs, or both?
• Can the PBM show the difference between billed cost, discount, rebate, and net cost?

This is one place where clarity matters. Employers cannot evaluate PBM performance when savings are hard to trace.

Intercept Rx offers a transparent pharmacy benefit model and returns 100% of rebates to the employer. That kind of structure can make the renewal conversation easier because the employer can see how savings are handled.

Can the PBM show which medications are driving the increase?

A renewal review should show more than totals. If pharmacy spend increased, the employer should be able to see which medications caused the increase and what changed from the prior year.

This is sometimes called drug-level reporting. In plain English, it means the PBM can show details by specific medication instead of only showing one large pharmacy spend number.

For example, a useful report may show:

• The medication name
• Total plan cost
• Number of members using the medication
• Employee out-of-pocket cost
• Change from the prior year
• Whether the drug is specialty, brand, generic, or GLP-1
• Whether a lower-cost option may be available
• Whether any action was taken on the claim

That is different from a report that only says pharmacy spend increased by a certain percentage.

Ask:

• Can the PBM show which medications are driving the increase?
• Can the employer see which drugs changed most from last year?
• Can the PBM identify lower-cost options?
• Can the PBM show employee out-of-pocket costs?
• Can the PBM explain what action was taken on high-cost claims?

A renewal number is easier to review when the employer can see the medications behind it.

How are employees supported when prescriptions are expensive or confusing?

A pharmacy strategy can fall apart when employees do not know who to call.

An employee may need help understanding coverage, finding a lower-cost option, using home delivery, or staying on a medication they cannot afford at the pharmacy counter.

This is where the PBM’s member support process matters.

Ask what happens when an employee has a prescription issue. Is there a real support team? Can the member get help before abandoning the prescription? Does the PBM guide members toward lower-cost options when appropriate?

Ask:

• Is there a real support team employees can contact?
• Can employees get help before they abandon a prescription?
• Are members guided toward lower-cost options when available?
• Does the PBM support free home delivery when appropriate?
• Are employees paying less out of pocket because of the program?
• Does the PBM track whether support helped the member fill the medication?

The employer should also ask how support is communicated. If employees do not know the program exists, they may still end up paying more than necessary or leaving the pharmacy without the medication.

Are there lower-cost sourcing opportunities for high-cost medications?

Employers should ask whether the PBM is actively looking for lower-cost options.

Some plans keep paying higher prices because nobody is reviewing the claim at the right level. A high-cost medication may continue to hit the plan month after month without anyone asking whether another sourcing option exists.

The question is simple: when a high-cost medication appears, what happens next?

Ask:

• Are high-cost medications reviewed before they hit the plan repeatedly?
• Can the PBM find lower-cost access for the same drug?
• Are savings opportunities shared with the employer?
• Does the program reduce plan cost without increasing employee cost?
• How quickly are savings opportunities acted on?
• Does the PBM report which claims were reviewed and what savings were found?

This is where pharmacy cost management becomes more specific. The employer is asking what happens when a real claim creates real cost pressure.

Intercept Rx’s Rx Optimization Program offers $0 copay medications, free home delivery, and dedicated member support for eligible prescriptions. For employers, that can create a clearer path to review high-cost medications, reduce plan spend, and make the prescription experience easier for employees.

What happens when an employee cannot afford their medication?

Employers should ask what happens at the pharmacy counter.

A prescription may look fine in the plan design and still be unaffordable to the employee. High copays can lead to delayed fills, skipped medications, and more frustration for the member.

For employees managing diabetes, heart disease, autoimmune conditions, or other chronic needs, skipping medication can create larger issues later. The mechanism is simple: when people cannot afford the medication they were prescribed, they may not take it as directed.

Ask:

• Are employees abandoning prescriptions because of cost?
• Which medications have the highest employee out-of-pocket costs?
• Are there $0 copay options available?
• Does the PBM track prescription abandonment?
• Is there a process to help employees before they stop treatment?
• Can the PBM identify members who may need support with high-cost prescriptions?

This question also helps employers connect pharmacy strategy to the employee experience. Renewal review is not only about what the plan paid but also about whether the benefit worked when employees needed it.

What should employers ask before accepting the renewal?

Before accepting a renewal, employers should ask for a pharmacy review that answers the questions behind the increase.

A recent health care cost projection estimates commercial health care costs will rise 9% in 2027, with rising pharmacy spending listed as one of the cost drivers. For employers reviewing pharmacy benefits, that makes PBM questions harder to leave until the end of renewal.²

For self-funded and level-funded employers, that is a reason to ask more specific pharmacy questions before locking in the next plan year.

Use this checklist during renewal review:

• What changed in pharmacy spend this year?
• Which drugs created the largest cost increases?
• How much of the increase came from specialty drugs?
• Are rebates and discounts clearly shown?
• Are employees paying more for prescriptions?
• Are there lower-cost options for high-cost drugs?
• Is the PBM showing savings opportunities at the drug level?
• Are members getting help when prescriptions are expensive?
• Can the current PBM explain the renewal increase clearly?
• What should change before the next plan year?

The answer to each question should be specific enough to guide a decision.

A vague answer may sound fine in a meeting, but it will not help an employer understand whether pharmacy spend is being managed or simply passed through.

Before accepting the renewal, ask for a clearer pharmacy review

Before accepting another renewal increase, employers should ask for a clearer pharmacy review.

That review should show what changed, which medications are driving costs, how rebates and savings are handled, and whether employees are getting enough support when prescriptions become expensive.

Intercept Rx helps self-funded and level-funded employers find pharmacy savings opportunities, reduce employee prescription costs, and review high-cost medications with more transparency.

Click HERE to request a Free Drug Savings Analysis from Intercept Rx.

Key Takeaways

• Renewal reviews should show what is driving the pharmacy increase, not just the total number.
• Employers should ask which medications, specialty claims, rebates, and employee costs are affecting the plan.
• PBM reporting should make savings opportunities easier to see and act on.
• Employee support matters when high prescription costs lead to abandoned or delayed medications.
• Before accepting another increase, employers should ask for a clearer pharmacy review.

Footnote Markers:

¹ https://www.mercer.com/en-us/solutions/health-and-benefits/research/national-survey-of-employer-sponsored-health-plans/

² https://www.pwc.com/us/en/industries/health-industries/library/behind-the-numbers.html