Cost Leakage Battle Group

Cash you can reasonably get back from your benefits stack.

Cost Leakage is about recoverable dollars — not vague "savings." Kincaid IQ reconciles contracts, claims, and fees to isolate where money is leaking today and what can actually be reclaimed in the next 12–24 months.

What this battle group answers

• Where are we overpaying vs. our own contracts?
• How much PBM & vendor leakage is recoverable?
• Which line items should we attack first?
• What's our 12–24 month cash recovery range?

Identified leakage

$3.2M

annualized, across fees & unit cost

Recoverable in 12–24 months

$1.3–1.9M

realistic range, not sales math

Contract variance rate

11.4%

claims priced off-contract

Benchmark position

Bottom quartile

vs. similar risk & industry

Leakage map by category (illustrative)

A simple view that shows where dollars are leaking: contracts, claims, fees, and mispriced risk.

CFO + CHRO view

CategoryEst. leakageRecoverablePriority

PBM spread & MAC$1.4M$0.7–0.9MHigh

Rebates retention$0.9M$0.3–0.5MHigh

Network / out-of-network$0.5M$0.2–0.3MMedium

Admin fees & pass-throughs$0.4M$0.1–0.2MMedium

Exact figures change by employer, but the pattern is consistent: we reconcile contracted vs. actual pricing, normalize against peers, and mark what's genuinely recoverable in a deal-relevant timeframe.

Common cost leakage sources we identify

PBM Spread

$680K

Difference between PBM acquisition cost and amount charged to employer

Retained Rebates

$320K

Manufacturer rebates kept by PBM rather than passed through

Admin Fee Overcharges

$180K

Fees exceeding contracted rates or industry benchmarks

Claims Processing Errors

$240K

Duplicate adjudications, incorrect pricing, coordination of benefits failures

Network Access Fees

$150K

Undisclosed or inflated network access and data licensing fees

Formulary Steering

$230K

Higher-cost alternatives selected despite lower-cost equivalents available

Illustrative case

4,200-life manufacturer — finding real money, not slideware.

De-identified; pattern is typical, numbers are illustrative.

Inputs

• 24 months of Rx & medical claims
• PBM contract, MAC list, rebate schedule
• Admin fee and TPA invoices

Findings

• Significant spread in common maintenance drugs
• Rebate retention above peer norms
• Off-contract pricing pockets in specialty

Modeled outcome

• $1.5M realistic recovery over 18 months
• Cleaner PBM terms without vendor swap
• Playbook to defend savings at renewal

Run a Cost Leakage scan on your plan.

We'll map out where cash is leaking today, what's actually recoverable, and in what order to go after it.

Request Cost Leakage scan Back to all battle groups