For years, employers have relied on familiar strategies to manage pharmacy spend: increase generics, manage utilization, and monitor overall volume. But today’s data shows that playbook is no longer enough.
Pharmacy isn’t just growing—it’s fundamentally changing the cost equation.
Within Benefitfocus data found in the 2026 State of Employee Benefits Report, medical costs have stabilized or even declined in some cases. But pharmacy has emerged as the primary driver of total cost growth, at 29.5%, up 2.3% YoY.1 Volume isn’t even the main driver behind that shift – it’s the concentration of high-cost prescriptions where generic prescription availability is limited. The majority of prescription spend (51.7%) goes to brand drugs with no generic options, although these were attributed to only 12.6% of prescription orders. Specialty drugs took 35.9% of the spend and 1.4% of prescription orders.1
The implication for benefits leaders is significant: traditional levers like utilization management or generic substitution are no longer enough to meaningfully impact spend. Cost growth is increasingly tied to high-cost therapies with limited alternatives.
That means the focus has to shift from broad strategies to targeted intervention and a closer examination of health claims data:
Which therapies are driving costs?
Which members are impacted?
Where do sourcing and coverage decisions matter most?
Without that level of insight, pharmacy spend can quietly outpace everything else, even when other areas appear well-managed. But it’s not a losing battle.
Connect with Benefitfocus today and discover how deeper pharmacy insights can help you identify cost drivers and take targeted action before spend accelerates.
