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Rebates: How PBMs Save Patients Money


PBMs were first brought into the health care system to work on behalf of health plan sponsors to lower prescription drug costs by negotiating directly with Big Pharma and drugstores. PBMs have been able to keep drug costs in check by obtaining and passing along rebates from these negotiations.

As drug manufacturers increase drug costs on consumers through twice-a-year price hikes, PBMs are continuing to work on behalf of patients to negotiate lower prices and pass those savings to patients and payers. Through these efforts, PBMs help save patients an average of $962 per year. These cost reductions are commonly known as “rebates.”

And the numbers don’t lie: studies show that the increase in drug prices are not correlated or caused by the rebates negotiated on behalf of patients by PBMs.

It’s clear that PBM-negotiated rebates not only reduce costs in the health care system but more importantly, they also ensure vital medications remain affordable and accessible to patients.

PBMs are working to ensure these rebates can continue to secure savings for our 266 million patients across the country.

Recent reports by the Government Accountability Office (GAO) and HHS Office of the Inspector General (OIG) found that PBM-negotiated rebates lower prescription drug costs:

  • The GAO report found that virtually all – 99.6% – prescription drug rebates negotiated by PBMs with drug manufacturers, in Medicare Part D, are passed through to plan sponsors and used to lower costs for Medicare beneficiaries.
  • An HHS OIG report also confirms that PBM-negotiated rebates lead to lower prescription drug costs, specifically in the Medicare prescription drug program.

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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.

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