Optum Rx expands pharmacy payment model

Optum Rx expands pharmacy payment model All community and independent pharmacies in the Optum Rx network are transitioning to cost-based contracts.

Reimbursement By Susan Morse , Executive Editor | December 19, 2025 | 10:02 AM Photo: alvarez/Getty Images Optum Rx has announced that it has expanded its cost-based pharmacy reimbursement model by partnering with three additional Pharmacy Services Administration Organizations (PSAOs), representing more than 17,000 community pharmacies.With this addition, 100% of community and independent pharmacies in the Optum Rx network have transitioned to the new predictable pricing model using cost-based contracts.Optum Rx seeks full implementation by January 2028.The change offers community pharmacies better transparency and financial predictability to manage costs, Optum Rx said. WHY THIS MATTERSThere is an increase in the use of expensive brand-name drugs that is significantly increasing costs for pharmacies, Optum Rx said.This is because pharmacies buy the medications they dispense to patients. They are reimbursed after a patient gets their prescription.In 2023, drug companies launched new U.S. drugs at prices 35% higher than the previous year, according to Optum Rx. Across brand drugs, manufacturers have set list prices in the U.S. 422% higher than in other nations, it added. Optum Rx’s model is shifting from a legacy, industry-wide practice that was designed to help promote the use of affordable generics. Effective generic adoption is now quite strong, and increasingly, more high-cost branded drugs are entering the market, raising costs for pharmacies, the company said. Reimbursement will now better match the cost of drugs. The financial predictability offered will allow pharmacies to stock more medications, giving patients better access to their prescriptions, Optum Rx said. In parallel, Optum Rx said it would also transition client arrangements, such as employer and health plan customers, to ensure transparency and greater alignment to drug costs. These changes are being made with full implementation by January 1, 2028.THE LARGER TRENDIn March, Optum Rx, a pharmacy benefit manager that is one of the biggest divisions within UnitedHealth Group, made the shift to the new reimbursement model.“This is the latest effort from Optum Rx to better support the important role of community pharmacies,” the company said. “With this change, community pharmacies will have more transparency and financial predictability to manage costs as brand-name drug prices and usage increase.”This was expected to positively impact more than 24,000 independent, community pharmacies.The company said the change builds on its recent commitment to pass through 100% of drug rebate discounts negotiated with pharmaceutical manufacturers to clients by January 1, 2028. ON THE RECORD“Pharmacies and pharmacists provide important care to patients, and we recognize that increasing drug prices make it hard for them to afford needed medicines, especially independent and community pharmacies,” said Dr. Patrick Conway, CEO of Optum Rx. “This move will help correct imbalances in how pharmacies are paid for brand and generic drugs and will ensure greater access to medicines for patients across the country.” Topic: Accounting & Financial Management, Operations, Pharmacy, Reimbursement