What is a dispensing fee in a PBM contract?

A dispensing fee is a fixed per-claim payment to the pharmacy on top of the drug's acquisition cost. It compensates the pharmacy for the labor of dispensing the prescription — verification, counseling, packaging, recordkeeping.

In a NADAC pass-through contract, the plan pays NADAC plus the dispensing fee per claim. Dispensing fees typically range from $1 to $11 depending on the contract, with $3-$5 being common for retail and $1-$2 for mail-order.

In spread-pricing contracts, the dispensing fee is often built into the spread itself rather than billed separately — the PBM's effective margin on generic claims commonly covers what a dispensing fee would otherwise be, plus substantial markup. This is why moving to pass-through pricing often INCREASES dispensing fees while DECREASING total cost: the fee becomes explicit instead of hidden.