Report a negotiation

Model contract Section 2.4

The PBM owes duties of loyalty and care solely to the plan and its members, must disclose all direct and indirect compensation and every economic conflict, and must disgorge anything retained in breach without the plan proving damages.

Model contract Sections 2.4, 2.6

All PBM and related-entity compensation, affiliate ownership touching plan claims, and payments to consultants or brokers are disclosed, and a named officer certifies quarterly and annually that everything has been disclosed and remitted.

Model contract Proposed Exhibit A-5

A signed exhibit lists every owner, parent, subsidiary, affiliate, group purchasing organization, rebate aggregator, mail order pharmacy and specialty pharmacy tied to the PBM, and the PBM must refresh it within 30 days of any change in ownership or control.

Model contract Section 1

Rebate, manufacturer revenue, affiliate, specialty, generic and pharmacy are defined by economic function, not by label, so value cannot be relabeled (for example as fees) to escape pass-through or guarantees.

Model contract Section 4

One hundred percent of manufacturer revenue of every kind is paid to the plan, quarterly within 30 days of quarter end, with only a closed list of excludable claims.

Model contract Section 3.2

Claims dispensed by PBM-owned or economically related pharmacies (mail, specialty, retail) are invoiced at net acquisition cost plus a stated dispensing fee, with no retained margin and a documentation default if records are not produced.

Model contract Section 3.3

Plan claim cost can never exceed a published benchmark, for example the transparent cash price at a benchmark site, in any channel and for any drug, and the ceiling is checked claim by claim rather than on average.

Model contract Section 3.4

A member never pays more than the pharmacy cash price or the cheapest lawful price, every cash purchase counts toward the deductible and out of pocket maximum, and no accumulator adjustment is applied against member assistance unless the sponsor elects it in writing.

Model contract Section 3.5

A single MAC list applies to both what the plan pays and what pharmacies are paid, it is disclosed, updated on a schedule, and pharmacies have an appeals path with defined timelines.

Model contract Sections 2.5, 3.1, 3.5

The plan pays exactly what the pharmacy is paid plus a disclosed administrative fee. The PBM retains no difference between the two, in any channel.

Model contract Section 5

Purchase discounts, volume credits and supplier payments received by the PBM or any related purchasing entity (including offshore GPOs) flow to the plan, allocated on disclosed drivers.

Model contract Section 6

The plan sponsor approves the formulary and every change, receives lowest-net-cost analysis, and gets utilization management outcomes by drug each quarter.

Model contract Section 6

Formulary decisions must meet a lowest net cost standard for this plan, the PBM delivers an annual comparison against its whole book of business, and any drug placed above a cheaper equivalent is disclosed with the reason.

Model contract Section 7

Claims are final when adjudicated (no retroactive clawbacks), reimbursement is not conditioned on volume, the PBM may not steer claims into its own pharmacies, and any willing pharmacy may participate at the plan's terms.

Model contract Section 8

The plan automatically receives pricing at least as good as any comparable client, and can run an annual market check with a meet, credit or release remedy.

Model contract Section 9

The plan may audit with its own auditor, receives full claims-level and financial data on a schedule without asking, has pre-adjudication claims access, and no data is withheld as proprietary.

Model contract Sections 9.4, 9.5

The plan sponsor is the sole owner of claims, eligibility, accumulator, rebate and every derived data set, the PBM delivers it in machine readable form on request, and the PBM may not reuse, license or sell it.

Model contract Section 10

Guarantees are measured quarterly on plan-specific data, reconciled in cash, and shortfalls are paid dollar for dollar rather than as capped credits.

Model contract Sections 10, 12.5

Missed guarantees and late reports trigger liquidated damages or automatic credits without the plan having to prove damages, and a second material breach or regulatory integrity failure lets the sponsor terminate without penalty.

Model contract Section 11

No amendment is effective unless signed by both parties; the PBM cannot change economic terms by notice, portal update or updated exhibit.

Model contract Section 12

The plan may terminate for convenience with reasonable notice and without penalty, earned amounts are never forfeited, and a regulatory integrity event is grounds for termination.

Model contract Sections 1.16, 3.2(d)

Specialty is defined by function, drug-level rates act as a ceiling in every channel, and specialty claims at affiliate pharmacies are priced at acquisition cost.

Model contract Sections 9, 14

Nothing in the contract stops the plan from sharing pricing, rebate or performance data with its own advisors, auditors, members, the public or lawmakers, and nothing stops pharmacies from telling patients about cheaper options.