CalPERS Considers Using Pharmacy Benefits Manager for All Drug Purchases

After spending $264.9 million on prescription drugs last year, the California Public Employees Retirement System is considering delegating prescription purchases for its plans to a pharmacy benefits manager, the Sacramento Bee reports. Currently, CalPERS only uses Merck Medco, a PBM, to negotiate with pharmaceutical companies for discounted prescriptions for its two self-insured preferred provider organization plans. By using a PBM to negotiate prices for all of its 1.2 million members, CalPERS could get lower prices for its most frequently used drugs, the Bee reports. Craig Copeland, a senior research associate with the Employee Benefits Research Institute, said, "A move like this by CalPERS may get pharmacy benefits managers to be the norm instead of something just a few people are doing." However, HMOs say that the plan could "undercut" health plans' ability to manage care, because they would no longer be able to track patients' prescription history (Rapaport, Sacramento Bee, 5/27). CalPERS is often considered a "bellwether" for health costs nationally (Kaiser Daily Health Policy Report, 3/22).