Therapeutics, one of the largest US pharmacy benefit managers, aims to shift to upfront drug pricing and away from a complicated rebates-based system that critics say increases patient costs.

The company intends to offer its clients — health insurers and employers — what it calls a net cost model for 2028, Chief Executive Officer Mostafa Kamal said in an interview Wednesday. He said patients should get the discounts that drug companies pay when they fill their prescriptions at the pharmacy. Prime seeks to keep its clients’ overall costs the same or lower than the current setup.

The approach mirrors a strategy from Cigna Group’s Express Scripts, one that some smaller competitors have long touted. Typically, clients hire PBMs to negotiate prices with pharmaceutical companies and payments to retail pharmacies. To get on insurer lists of approved drugs, the drugmakers pay PBMs rebates on the official prices of medications.

But the rebates are paid months after a prescription is filled, making it difficult to give the discounted price to patients. PBMs pass most of the money to the health plan sponsors.

Prime, which has 22 million people on its drug-benefit plans, doesn’t yet have clients committed to the new approach, Kamal said.

“Ideally we’d have everybody in this, but I’m not Pollyannish,” he said. “We’re fundamentally transforming a model that has existed for decades.”

Prime is a privately-held pharmacy benefit manager owned by independent Blue Cross and Blue Shield plans, which are also its clients. It competes with larger, vertically integrated PBMs including units of Cigna, CVS Health Corp. and UnitedHealth Group Inc. It’s also one of Cigna’s largest clients as it participates in a joint venture to negotiate drug rebates with pharma companies.

The PBM business model has long been criticized for opacity and potential conflicts of interest. The companies don’t always fully pass through rebates and other fees they collect from drugmakers to their clients.

What’s more, they often charge administrative fees that are set as a percentage of a drug’s list price, an arrangement critics say pushes prices higher. PBMs argue that drugmakers set prices and that they are a counterweight to unchecked pricing power.

Many health plans use rebate payments to offset overall costs in the plan, lowering premiums. Passing those discounts to patients directly could mean premiums have to go up. That’s partly why existing PBM options that offer rebates at the point of sale have limited adoption, Kamal said.

Kamal said Prime is looking for ways to “to limit the premium impact” of the move.

Years of escalating scrutiny from regulators have forced some changes. Last year Cigna said it was making a “fundamental business pivot” to phase out drug rebate payments. Its shares tumbled the most since 2008 when it revealed last October that the change would temporarily hurt its profit margins. The stock still hasn’t recovered.

The pressure is mounting on the industry. “Employers, armed with greater visibility, are increasingly challenging historically important PBM profit drivers,” Jefferies analysts led by David Windley wrote in a September research note.

Outside of rebates and fees, PBMs could also charge a spread between what they pay pharmacies and what they bill health plans for a prescription. New laws are set to require PBMs to disclose more about how they make money, prying open businesses that have long been black boxes.