Pharmacy benefits is "one area of the health care value chain ripe for transformation." At least that's according to "Drawing a Line in the Sand: Employers Must Rethink Pharmacy Benefit Strategies," the latest report from Midwest Business Group on Health, a non-profit employer coalition of 130 self-funded public and private employers.

"In theory, a drug should function like any other product in a rational consumer purchasing transaction, but it does not," the authors write. "Requirements related to the distribution of products, patient safety and clinical efficacy have pushed the industry to develop a complex chain of middlemen that deliver point solutions and are interdependent on one another, resulting in a longer and more complex channel."

That complexity is compounded by an aging population, a continued rise of chronic disease, and the accelerated commercialization of innovative drugs that carry very expensive price tags, according to the report.