Friends With Benefits: Mike Miele on PBMs, GLP-1s, Rebates, and the Future of Drug Pricing

For the first episode of our new Friends With Benefits series on The EOB Podcast, we brought on one of the smartest people we know in the healthcare benefits industry: Mike Miele.

And honestly, we wanted to start this series with someone who could speak candidly about one of the most talked-about — and misunderstood — topics in healthcare right now:
PBMs and pharmacy costs.

Mike works at Capital Rx, a transparent pharmacy benefit manager focused on modernizing pharmacy pricing and visibility. Throughout the conversation, we dug into:

• GLP-1 drugs like Ozempic and Wegovy
• Pharmacy rebates
• Formulary decisions
• PBM transparency
• Employer pharmacy spend
• Drug pricing economics
• Why employers still struggle to access their own data

And as expected, the conversation got very real very quickly.

GLP-1 Drugs Are Driving Pharmacy Trend Right Now

One of the biggest topics in healthcare benefits right now is GLP-1 medications.

Drugs like:

• Ozempic
• Wegovy
• Mounjaro
• Zepbound

…have completely changed the pharmacy landscape over the last two years.

According to Mike, GLP-1s are now driving the overwhelming majority of pharmacy trend increases across employer health plans.

He shared that within Capital Rx’s book of business:

• Plans covering GLP-1s strictly for diabetes saw around 3% trend growth
• Plans covering GLP-1s for weight loss experienced trend closer to 12%
• Some employers are seeing even higher increases

That’s a massive shift in a very short period of time.

And it raises an important question:
How do employers balance access to these medications with long-term plan affordability?

Employers Have More Control Than They Think

One of the most interesting parts of the discussion centered around how employers can actually structure GLP-1 coverage differently.

Many plan sponsors assume they only have two choices:

• Cover everything
• Cover nothing

But that is not necessarily true.

As Mike explained, employers can work with PBMs and clinical committees to:

• Tighten eligibility criteria
• Require validation of comorbidities
• Monitor BMI requirements
• Implement prior authorization controls
• Pair medications with coaching programs
• Create alternative reimbursement approaches

The key point was this:
Uncontrolled access is probably not sustainable long term.

And honestly, that is where a lot of employers are struggling right now.

They want to support employees.
They understand the clinical potential of these drugs.
But they also cannot absorb unlimited pharmacy trend increases forever.

The Long-Term Questions Around GLP-1s Are Still Unclear

Another major topic throughout the episode was the long-term future of GLP-1 drugs.

Originally, many people believed these medications would function as temporary weight-loss tools.

Now, the narrative is shifting toward chronic disease management and potentially lifelong treatment.

That creates major questions for employers:

• Will long-term medical costs eventually decrease?
• Will these drugs improve chronic disease outcomes?
• Will pharmacy spend continue exploding?
• What happens if employees stay on these medications indefinitely?
• Are plans financially prepared for that reality?

And frankly, nobody fully knows the answer yet.

As Mike pointed out during the conversation, the widespread GLP-1 explosion is still relatively new. The industry simply does not have decades of long-term claims data yet.

But what we do know is this:
These medications are already reshaping pharmacy benefit strategy across the country.

PBM Rebates Are Much Bigger Than Most Employers Realize

One of the biggest “mind blown” moments in the episode came during our discussion around pharmacy rebates.

Mike shared that in 2024, rebates represented roughly:
35% to 40% of total drug spend.

Read that again.

If an employer spent $10 million on pharmacy claims, they may have received:
$3.5 to $4 million back in rebates.

That is an enormous amount of money moving through the system.

And one of the biggest problems is that many employers:

• Do not know how rebates work
• Do not know what they should be receiving
• Do not know how rebates are calculated
• Do not know where retained amounts may exist
• Do not receive granular rebate reporting

That lack of visibility creates major fiduciary concerns.

Because if employers cannot fully track how money moves through their pharmacy plan, how can they properly monitor it?

Why Transparent PBMs Are Becoming More Important

One of the strongest themes throughout the episode was transparency.

Mike discussed how many traditional PBM models still operate with:

• Limited data access
• Aggregate reporting
• Opaque rebate structures
• Restricted visibility
• Complicated contract language

Meanwhile, transparent PBMs are increasingly differentiating themselves by offering:

• Granular claims reporting
• Drug-level rebate data
• Pass-through pricing models
• Clearer contract structures
• More direct employer access to information

And honestly, this is where the industry is heading.

Because employers are asking harder questions than they were even five years ago.

Questions like:

• Where is rebate money actually going?
• What portion is retained?
• Why can’t we access our own reporting?
• Why is this considered proprietary?
• How are formularies determined?
• Who is making financial decisions?

Those questions are becoming far more common.

Formulary Decisions Are Not Always Purely Clinical

One of the most fascinating conversations in the episode centered around formularies.

Specifically:
Who actually decides which drugs are covered?

Mike explained that Pharmacy & Therapeutics (P&T) Committees are supposed to independently evaluate clinical effectiveness.

But once drugs are considered “therapeutically equivalent,” financial negotiations can start driving formulary placement decisions.

That becomes especially controversial when:

• Rebate arrangements influence preferred drug selection
• Employers experience formulary disruptions
• Employees are forced to switch medications
• PBMs negotiate exclusive deals

We discussed the real-world example involving CVS Caremark shifting formulary preference toward Wegovy while removing Zepbound from certain formularies.

And that raises difficult questions:

• Are decisions always being made based purely on clinical outcomes?
• Where do financial incentives enter the equation?
• How transparent are those decisions to employers?

Those are conversations the industry is only beginning to have publicly.

Employers Need Better Pharmacy Data

One of the biggest frustrations we discussed throughout the episode is how difficult it still is for many employers to access detailed pharmacy reporting.

Even with laws like the CAA and RXDC reporting requirements in place, many employers still hear:

• “Why do you need that?”
• “That data is proprietary.”
• “We only report in aggregate.”
• “There will be an additional fee.”

And honestly, that should concern employers.

Because active plan management requires actual visibility.

You cannot prudently monitor:

• Rebates
• Trend drivers
• High-cost drugs
• Utilization patterns
• Formulary performance
• Financial leakage

…if you cannot access the underlying information.

That was one of the biggest themes throughout this entire conversation.

PBM Procurement Is Still a Major Problem

Toward the end of the episode, Mike brought up something we completely agree with:
Many PBM RFP processes are outdated.

According to Mike, many PBM consultants are still evaluating proposals using criteria that are:

• 10 to 15 years old
• Focused on outdated benchmarks
• Missing modern transparency concerns
• Ignoring problematic contract provisions
• Failing to address fiduciary oversight

And honestly, this is something we see constantly in the healthcare benefits industry overall.

Employers are often asking:
“How do we get the best deal?”

…instead of first asking:
“What contract terms should not exist at all?”

That mindset shift matters.

Because transparency, audit rights, reporting access, rebate structures, and fiduciary governance are all becoming far more important than headline discount guarantees alone.

Final Thoughts: Employers Need Straight Talk, Not Buzzwords

One of our favorite moments from the episode came at the very end when we asked Mike what industry buzzword he would eliminate forever.

His answer:
“Synergy.”

And honestly, that perfectly captured the entire conversation.

Healthcare benefits does not need more buzzwords.
It needs more straight talk.

That was really the purpose behind launching the “Friends With Benefits” series in the first place.

We wanted real conversations with industry insiders who are willing to:

• explain how the system actually works
• challenge outdated thinking
• simplify complicated topics
• give employers practical insights
• have honest discussions about where healthcare is heading

And Mike delivered exactly that.

FAQ: PBMs, GLP-1s, and Pharmacy Transparency

What are GLP-1 drugs?

GLP-1 drugs are medications originally developed for diabetes management that are now widely used for weight loss and chronic disease management. Examples include Ozempic, Wegovy, Zepbound, and Mounjaro.

Why are GLP-1 drugs increasing healthcare costs?

These medications are expensive, highly utilized, and increasingly being used long term, causing pharmacy trend increases for many employer health plans.

What is a PBM?

A Pharmacy Benefit Manager (PBM) is a company that administers prescription drug benefits for health plans and employers.

What are pharmacy rebates?

Pharmacy rebates are payments made by drug manufacturers to PBMs or other entities in exchange for favorable formulary placement and utilization.

Why is PBM transparency important?

Transparency helps employers understand how pharmacy dollars move through the system, including rebates, fees, pricing structures, and formulary decisions.

Can employers request detailed pharmacy data?

Yes. Employers should be requesting granular reporting, rebate information, and RXDC data to better monitor pharmacy spend and fiduciary risk.

Listen to the Full Episode

To hear the full conversation with Mike Miele and explore more discussions around PBMs, pharmacy transparency, healthcare costs, and employer benefit strategy, visit The EOB Podcast