Administrative fees are a source of revenue for PBMs in what manner?

The correct option highlights the primary method by which Pharmacy Benefit Managers (PBMs) generate revenue through administrative fees. Payment per claim processed represents a transactional model where PBMs charge plan sponsors a fee for each claim they handle. This fee structure is straightforward; the more pharmacy claims a PBM processes, the more revenue it earns. This method aligns with the operational costs that PBMs incur regarding the management of prescription drug claims, including payment processing, adjudication, and customer service.

In contrast, the other options represent different kinds of revenue streams that may not be as directly linked to the operational structures of PBMs. Annual subscription fees from pharmacies could imply a membership system that offers certain services or benefits, but it is not the primary way PBMs monetize their services. Costs incurred by plan sponsors may reflect expenditures that a plan faces in utilizing a PBM, rather than a fee structure for administrative tasks performed. Per employee per month costs pertain to a more fixed fee structure that might cover a range of services but does not specifically relate to the processing of individual claims.

Understanding this key revenue source is crucial for grasping how PBMs operate financially and how they interact with both pharmacies and plan sponsors in the healthcare ecosystem.