Mark Cuban Gets Real on Health Insurance: The House Always Wins

Hannah Mamuszka and Lena Chaihorsky interview entrepreneur Mark Cuban about why U.S. drug and healthcare prices are so high — and what he's building to counter them. Cuban walks through the drug supply chain: brand manufacturers sell to three dominant distributors, then pharmacy benefit managers (PBMs) — the three largest of which are owned by or own major insurers — use rebates to set formulary placement, which he argues drives list prices up and can block patients from the drugs their doctors prescribe. He describes the gap between a drug's list price and its much lower "net" price after confidential rebates, and argues that opacity and confidentiality clauses keep even self-insured employers from knowing what they actually pay. His prescription: transparency and direct contracting ("if you can schedule it, you can negotiate it"), plus his ventures — Cost Plus Drugs (cost + 15% markup), Cost Plus Wellness, a Dallas plant making shortage drugs, and a proposed bank-account-based alternative to insurance (the "10 plan"). He also urges employers to run their contracts through AI tools to spot unfavorable terms.

Key takeaways

• The drug-pricing problem is structural: three big distributors, three big PBMs vertically integrated with the three big insurers, and rebate-driven formulary placement that Cuban argues rewards high list prices over patient affordability.
• List price ≠ net price: confidential rebates create a large gross-to-net gap, and confidentiality clauses keep even self-insured employers (who bear the cost) from seeing real prices.
• Cuban's counter-model is transparency plus direct contracting — buying care and drugs at negotiated/Medicare-referenced rates rather than through opaque insurer/PBM arrangements.
• Practical tip he offers employers: feed carrier and PBM contracts into an AI tool to flag undefined terms and unfavorable clauses.

Relevant links

• FTC interim staff report on PBMs (market concentration, vertical integration): https://www.ftc.gov/system/files/ftc_gov/pdf/pharmacy-benefit-managers-staff-report.pdf
• KFF 2025 Employer Health Benefits Survey (self-funded plan share): https://www.kff.org/health-costs/2025-employer-health-benefits-survey/
• CVS Caremark's Zepbound → Wegovy formulary change (Mass.gov notice): https://www.mass.gov/news/cvs-caremark-decides-to-remove-zepbound-from-cvs-caremark-formulary
• Mark Cuban’s Cost Plus Drugs (15% markup, Dallas manufacturing): https://www.markcubancostplusdrugcompany.com/
• FDA GDUFA generic drug (ANDA) fee rates: https://www.fda.gov/industry/fda-user-fee-programs/generic-drug-user-fee-amendments
• KFF on ACA Marketplace deductibles: https://www.kff.org/affordable-care-act/what-we-know-so-far-about-2026-aca-marketplace-enrollment-premiums-and-deductibles/