New Research Reinforces the Value of PBMs
A new study by the National Bureau of Economic Research called The Value of Pharmacy Benefit Management shows that PBMs create more than $145 billion in annual value. Without PBMs, the study found, employers, labor unions, and other health plan sponsors would lose out on $58 billion in value each year.
Pharmacy benefit managers, better known as PBMs, administer prescription drug plans for more than 266 million Americans with health insurance from those insured through an employer to people using Medicare. PBMs lower the cost of prescription medication by 40% to 50%, according to the study. In total, PBMs save payers and patients an average of $962 per person each year.
The result is far better health outcomes for millions of Americans.
“The value to society includes not only consumer savings … but the values of better drug utilization, an increased pace of drug development, and government savings,” wrote Casey Mulligan, the University of Chicago economics professor who authored the paper.
JC Scott, president and CEO at the PCMA, praised Mulligan’s model, research, and conclusions. “The first-of-its-kind quantitative model and paper mathematically shows that PBMs are a cost-reducing force in our health care system,” Scott said in a statement. “It’s time, once and for all, to put to bed false assertions about PBMs and recognize the factual truth: PBMs create value for health care payers and patients, leading to significant cost savings and healthier outcomes for patients.”
Like many patients, Santiago is not directly involved in debates over prescription drug policy, but he is affected by those policies every single day. Santiago describes that effect in dramatic terms.
“I think the people behind the scenes, who are kind of making it affordable and giving that level of comfort for the patient, is huge,” he said. “I mean, without it, it would be a completely different conversation about what we’re paying and what we’re expecting every time we go to the pharmacy.”
To see how PBMs are #OnYourRxSide, see Santiago’s story here.
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Pharmacy benefit managers (PBMs) are your advocates in the health care system, working to lower out-of-control prescription drug costs for patients across the country.