Replay - PMPM vs Clinical Guarantees: A Pharmacist and an Actuary Explain How to Create Predictability Around Pharmacy Spend

Most employers have experienced being promised double-digit percentage savings on their plan's drug spend year-over-year, only to never realize those savings. Sometimes it's frame as a promise; other times it's simply a suggestion based on a "traditional spreadsheet analysis" during a pharmacy benefit procurement process. The clean, neatly modeled output of that analysis has historically focused on the unit cost of the medication plan members need, but savings based on this traditional analysis rarely – if ever – materialize. When that happens, plan sponsors are stuck with a positive cost trend. The good news: the next request for proposal (RFP) process can be different.

On March 5, 2026, Judi Health’s Kristin Begley, PharmD (Chief Commercial Officer) and Mike Miele, FSA, MAAA (SVP, Insured Services) explained how plan sponsors can evaluate and compare PBM “offers” (or “bids”) in a fairer and more accurate way by emphasizing drug mix and looking at clinical guarantees that provide a more rational view of what the plan’s overall costs could look like.

Check out the highlights below! And if you want to review the full webinar replay, click here.

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‍Clinical Programs And The Red Herring Of Generic Dispensing Rates

Kristin explains why a low generic dispensing rate (GDR) may signal that a PBM is chasing higher rebates by favoring more expensive brand and specialty drugs. She also discusses how focusing on clinical appropriateness over inflated rebate guarantees can lead to more significant, sustainable savings for your plan.

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‍The Reality Of NADAC Versus AWP Pricing

Mike reveals how some PBMs use inflated AWP-based models for certain drugs, leading to significant overspending, and how a NADAC-based model can introduce more transparency and deflationary pressure on your pharmacy spend.

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The Financial Impact Of Auto-Refill Waste And Clinical Oversight

Leveraging a clear example, Kristin demonstrates how auto-refill programs can generate thousands of dollars in waste annually and how smarter clinical protocols can eliminate this unnecessary expense.

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The Reverse Fiduciary Test And The True Cost Of Rebates

For every dollar you gain in rebates, how much should you assume you're shouldering in ingredient costs? Kristin introduces the "reverse fiduciary test," which exposes the financial trade-offs of chasing high rebates and highlights why focusing on total drug cost provides a more accurate picture of your plan’s performance.

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Deconstructing PMPM Guarantees And The Illusion Of Risk Transfer

Per-member-per-month (PMPM) guarantees are gaining popularity, but do they truly transfer risk? Mike breaks down the mechanics of PMPM arrangements, explaining how they function as a fee-at-risk model for the PBM rather than a full financial protection for the plan sponsor.

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Curious how clinical guarantees can offer better and more reliable insights into plan costs? Get in touch with our team today!