Frier Levitt Co-founder Jonathan Levitt, Esq. and pharmacist-attorney Dae Y. Lee, Pharm.D., Esq., CPBS discuss some of the often untold truths about PBMs and manufacturer rebates in a recent issue of Benefits Pro.
“Plan sponsors are far too trusting of pharmacy benefit managers (PBMs) when it comes to understanding drug manufacturer rebate revenue. Rebate administration is one of the main services that PBMs offer to governmental entities, self-funded employers, insurers, and managed health care organizations (collectively, “plan sponsors”). PBMs receive two types of rebates: manufacturer rebates and pharmacy rebates. Manufacturer rebates are cash payments made by pharmaceutical manufacturers to PBMs that are theoretically designed to act as drug discounts. Pharmacy rebates are point-of-sale fees or post-sale chargeback (e.g., audit recoupment) that PBMs retain from their member pharmacies. Unfortunately, rebates became a lucrative revenue source for non-transparent PBMs at the expense of plan sponsors, manufacturers, patients, pharmacies and taxpayers….”
You can view the full article here.