When Elon Musk turned to Cuban, known for his straight talk and deep dives into healthcare reform, gave Musk and other CEOs a crash course in how their decisions directly impact the cost and quality of healthcare in the US.
“The key is the contracts that CEOs of self-insured companies sign,” Cuban wrote in response to Musk’s tweet. He explained that many of these contracts, especially with Pharmacy Benefit Managers (PBMs), are the cause of rising costs and poor care.
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Cuban laid out seven key issues with typical PBM agreements that affect not only companies like Musk’s Tesla and SpaceX, but also their employees and families:
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No control over claims data: Companies don’t get full access to the data about what’s being billed or paid.
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Limited formularies: PBMs determine which drugs are covered, often prioritizing profit over health.
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Overpriced ‘special medicines’: these are often marked up without justification.
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Rebates come at a cost: “rebates” paid by pharmaceutical companies ultimately increase employees’ deductibles and co-payments, hitting the sickest and oldest hardest.
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Harm to independent pharmacies: PBMs often reimburse small pharmacies for less than the cost of brand-name drugs, driving many out of business.
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No collaboration with manufacturers: Companies cannot work directly with drug manufacturers to create targeted wellness programs.
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Opaque contracts: Many PBM agreements include non-disclosure agreements, making the system inefficient and driving up prices across the country.
