When Elon Musk took to X to question why Americans aren’t “getting their money’s worth” despite the United States leading the world in health care administrative costs, Mark Cuban stepped in with some tough truths. Cuban, known for his straight talk and deep dive into health care reform, gave Musk and other CEOs a crash course on how their decisions directly impact health care costs and quality in the U.S.
“The key is the contracts CEOs of self-insured companies sign,” Cuban wrote in response to Musk’s tweet. He explained that many of these contracts, especially with Pharmacy Benefit Managers (PBMs), are at the root of spiraling costs and poor care.
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Cuban laid out seven major issues with typical PBM agreements that affect not only companies like Musk’s Tesla and SpaceX but also their employees and families:
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No control over claims data: Companies don’t get full access to the data about what’s being billed or paid.
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Restricted formularies: PBMs control which medications are covered, often prioritizing profits over health.
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Overpriced “Specialty Drugs”: These are often marked up without justification.
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Rebates come at a cost: “Rebates” paid by pharmaceutical companies ultimately increase employee deductibles and co-pays, hitting the sickest and oldest the hardest.
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Harming independent pharmacies: PBMs often reimburse small pharmacies less than the cost of brand-name drugs, driving many out of business.
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No manufacturer collaboration: Companies can’t directly work with drug manufacturers to create targeted wellness programs.
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Opaque contracts: Many PBM agreements include NDAs, making the system inefficient and increasing prices nationwide.
