MedBen is writing checks to self-funded clients totaling more than $976,000 for quarterly pharmacy rebates this week.

And while it may seem routine for MedBen clients, it is far from the norm in the pharmacy benefit management world. In fact, many pharmacy benefit managers (PBMs) withhold some or all of pharmacy rebates. Other third party administrators offer “discounts” from administrative fees in exchange for the right to keep rebates.

“It is best for the self-funded employer to demand all rebates,” said Kurt Harden, Senior Vice President for MedBen. “While the rebate amounts may fluctuate, it is highly unlikely that the discounted administrative fee will be a better deal than the rebate checks.”

“We have new clients who are surprised when they receive their rebate check,” Harden continued. “Some are surprised because they never received one from their previous carrier or administrator, while others are surprised at the amount on the check because their previous administrator or pharmacy benefit manager kept a portion of the rebates.”

MedBen also advises employers to demand all of the generic discount since another common practice is for PBMs to keep a portion of the discount. “Groups should be seeing generic discounts in the range of 75% off of Average Wholesale Price,” said Harden. “Many PBMs keep as much as 20% of the generic discount.”

MedBen was one of the first third party administrators in the country to offer clients a 100% transparent and pass-through pharmacy benefit program.