BUILDING BLOCKS > MANAGER > Benefit Administration & Organization

Pharmacy Benefit Managers

Does using an external organization to administer a drug benefit program
(or a prescription coverage plan) help contain expenditures for the manager/payer and individual?

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Policy Examples

  • In 2019, the House unanimously passed two bills (HR 2115 and HR 1781) that would increase transparency on prescription drug rebates. Both bills aim to boost access to data to address concerns that PBMs may be causing drug prices to rise by favoring drugs with high list prices and large rebates. source & source
  • The American Society of Health-System Pharmacists (ASHP) formally submitted a review “The Prescription Drug Pricing Reduction Act (PDPRA) of 2019.” Some areas they support include improving manufacturing costs including price transparency, inclusion of coupons in determination of sale prices, Medicare Part D redesign, and more. Some areas they believe need to be strengthened include public disclosure of drug discounts and audit results. source

Outcome Evidence

  • A 2019 study published by Pew found that the share of rebates PBMs passed through to insurers and payers increased from 78 percent in 2012 to 91 percent in 2016. source
  • A 2019 Government Accountability Office report found that 99.6 percent of prescription drug rebates negotiated by PBMs with drug manufacturers in Medicare Part D are passed through to drug plan sponsors and used to lower costs for Medicare beneficiaries. source
  • A 2019 Society of Human Resources Management (SHRM) survey found three in four large employers do not believe drug manufacturer rebates are an effective tool for helping to drive down pharmaceutical costs. Employers prefer to adopt PBM capabilities to make rebates available to consumers at the point of sale, rather than having the PBMs collect the rebates and pass the savings back to employers and health plans. source

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©2019 United States of Care Campaign