Mark Cuban, cofounder of Mark Cuban Cost Plus Drug, and Optum CEO Patrick Conway sat down for a moderated conversation on the role of PBMs in health care pricing at an event earlier this month held by the Hopkins Business of Health Initiative.
Asked why Optum charges full WAC price during the deductible phase versus the net price, Conway blamed benefit designs, claiming that patients pay only net price.
He said they have now instituted 100 percent rebate passthrough to clients; Cuban responded by asking, "If there's 100 percent passthrough, why are there rebates at all?"
Conway then tried to point the finger at drug manufacturers, saying they are responsible for the vast majority of the price of drugs; Cuban didn't accept that answer, asking, "Why do you have different prices for the same drug for different patients?"
"I talked to the same manufacturers you guys go out to bid, and you say, ‘we're going to have this expected volume, what's the best price you can give us?' They don't sell **** for price," he said.
Cuban, whose company publishes its price list, asked Conway why Optum doesn't do the same; Conway responded that their prices are lower than Cuban's almost 100 percent of the time, a claim he couldn't prove, because nobody knows what prices they charge.
Later in the talk, Cuban pointed out more about the problematic business model of PBMs.
"There's a reason why having 15 straight years of increased earnings, right, and then having that streak stop, and the CEO gets fired or leaves, and you replace them, right — there are incentives that seem to be misaligned with offering the best price for patient care," Cuban noted.
A few minutes later, Cuban asked Conway: "Would you agree that it would be the right thing to do to make it so that 100 percent of independent or all pharmacies are fully reimbursed for their cost of brand medications?"
Conway claimed Optum had done that already. Cuban was direct: "No, you didn't."
Conway pointed to a cost-based reimbursement program for pharmacies that has yet to impress — it doesn't mean pharmacies are breaking even.
In closing, when asked what he would do if he had the power to change one thing about the health care system, Cuban's answer was simple.
"Break up the big insurance companies … can't own PBMs, can't own providers, can't own their own technology. Make them all independent companies," he said. That comment was greeted with applause from the audience.
You can watch the whole event, which also includes a one-on-one interview with Cuban, here.
