Eliminating pharmaceutical rebates, is this déjà vu?

October 29, 2020

In July 2020, the Trump administration announced its intention, for the second time, to prohibit rebates for Medicare Part D drugs within pharmacy benefit managers (PBMs) as one of several new Executive Orders aimed at lowering prescription drug costs. The removal of PBM rebates by Executive Order is likely to be a substantial shock to the healthcare system.

In order to preserve the benefits of PBM formularies using rebates but to minimise the payments made by patients, Matt Majewski and Andy Parece offer an alternative proposal that can achieve the administration’s objective without fundamentally altering the existing model. They propose that the administration requires setting patient coinsurance levels based on the average sales price (ASP). Not only could this approach lower patient coinsurance costs while providing greater price transparency, it is also much easier to implement than the complete removal of PBM rebates.

To read the full article published in PMLiVE, click here.

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