Utilization management drives smarter pharmacy spend

Plan sponsors are finding themselves in an increasingly tough position.  With drug trend at 9% or higher this year the pressure is on to control costs. At the same time, members want to know their health care dollars are improving their health, not just raising their bills.

We agree. Drug spend that doesn’t lead to better health outcomes isn’t valuable – to you or your members. That’s why we continue to develop innovative strategies to manage costs while making sure members get the therapies they need. And we’re turning that commitment into dollars.

We help plans save as much as $91 per member per month (PMPM)* to counter the prediction of  through transparent, accountable and clinically sound utilization management (UM) strategies. While others predict 9%+ pharmacy trend, we’re working to slow that increase.

Cost management through every available lever

Cost management is central to what we do as a pharmacy benefit manager, but the goal isn’t spending less for its own sake. It’s spending smarter, so affordability and clinical integrity go hand in hand. We apply proven strategies, track how they perform in the real world, and adjust as needed with the goal of helping members get the right therapy at the right time, without unnecessary cost. These levers help reduce waste — not access — so your pharmacy spend translates into better outcomes. That means we have to make disciplined (and sometimes difficult) choices to protect affordability for you and your members.

We make the affordable choice — generics — the default. Nothing drives sustainable savings like clinically appropriate substitution at scale. Today, nine out of 10 prescriptions we dispense are generics, reflecting a strategy that delivers affordability while keeping quality care front and center.

We drive competition through preferred drug strategy. We have a long history of making purposeful, sometimes bold decisions to drive competition in the market on behalf of our plan sponsors — encouraging manufacturers to compete on net cost and delivering meaningful savings as a result. GLP‑1s are a great example. Last year, we prioritized a lower‑cost GLP‑1 option. The feedback was loud, but the results were clear. Market prices went down, with net costs getting as low as $99 and generating more than $500 million in savings.

We continue to unlock value through alternatives like biosimilars. We’ve helped deliver $3.3B in biosimilar savings^* by speeding up adoption and keeping the supply chain open. After we took Humira® off our preferred drug strategy templates, fewer than 1% of members transitioned back compared to a national average of 11%. 

UM: The least understood cost control lever

These are all powerful levers, but they work best within a utilization framework. Too often, UM gets boiled down to a static, legacy concept that just includes prior authorization (PA). The reality is it’s an evolving, multi-lever, highly effective capability at the heart of our approach that consistently drives results.  What sets Caremark apart is our disciplined, proactive process: we deploy surveillance, anticipate emerging needs and take decisive action to ensure optimal outcomes.

UM isn’t about denying care to save money. It’s a clinically driven system that promotes the right therapy for the right patient, at the right time, at the right dose. That means patients and plans don’t pay for therapies that aren’t working.

A modern UM approach includes:

• Appropriate initiation and step therapy when clinically justified
• Case and transition management
• Clear escalation when therapy is ineffective
• Clinical criteria (including PA where appropriate)
• Medical necessity review
• Monitoring requirements and adherence support

In high‑cost, non‑specialty categories like GLP‑1s, the challenge isn’t just price — it’s making sure coverage is cost-effective and clinically appropriate. UM syncs coverage with evidence‑based criteria, supports safe initiation, and lowers avoidable waste from misuse or early discontinuation — so coverage aligns with the members’ clinical needs.

Specialty is where UM is even more essential

More than 50% of total drug spend is on specialty medications. Utilization, and not just price, is a primary reason for that. We’re seeing an increasing number of members who take specialty medications because of an aging population, a powerful pipeline of new therapies and more ways to use them.

While we’ve worked to keep specialty net cost growth down through lowest net cost strategies, rising utilization requires stronger clinical oversight. That’s why we developed a specialty-focused UM approach: Specialty Guideline Management (SGM). 

SGM extends traditional UM with deeper clinical rigor. It looks at whether a member meets the criteria to start therapy and whether it’s clinically appropriate to continue treatment. For some complex conditions, SGM includes mandatory medical director review for all coverage requests, so members follow therapies that can deliver the most significant health benefits.

Forging the path to affordability

There’s no single path to pharmacy affordability. But there is a roadmap that consistently works:

• Apply the right cost levers
• Measure outcomes
• Never lose sight of clinical integrity

That’s the path we’re on, and we’re committed to the destination. True cost control isn’t just about spending less. It’s about spending smarter, with every dollar supporting better health.