Health Insurers & Pharmacy Benefits
A Primer.
This is my inaugural post. I hope you enjoy the work I put out going forward, I am sure my writing will get better over time, and I would love to hear your feedback @KarstResearch on X/Twitter. Rather than a lengthy introduction post, I will dive in. I feel confident in saying that I am knowledgeable when it comes to the world of healthcare and insurance (Health, P&C, and Reinsurance). This piece is meant to be a primer for understanding the healthcare/insurance system within the USA.
Note: PBM = Pharmacy Benefit Manager, MCO = Managed Care Organization.
The BUCAs
The large health insurers are known as BUCA – Blue Cross Blue Shield, United Healthcare, Cigna, and Aetna. They are known as Managed Care Organizations or payers.
Some notes regarding the structure of the BUCAs:
Blue Cross Blue Shield: A non-profit organization, however they do own a publicly traded for-profit company known as Elevance (NYSE: ELV), as well as Prime Therapeutics PBM.
United Healthcare: the health insurance arm of United Health Group (NYSE: UNH), United Health Group also owns Optum PBM.
Cigna: Publicly traded company (NYSE: CI), which owns Express Scripts PBM.
Aetna: Purchased by CVS Health (NYSE: CVS) in 2018 and currently utilizes the CVS Caremark PBM.