The Impact of Pharmacy Benefit Managers on Access to Affordable Treatment

Pharmacy benefit managers (PBMs) have a significant impact on prescription drug costs and the ability of patients to obtain the medications they need in a timely and affordable manner, and yet very little is known about their role. The AACU is dedicated to working with policymakers at both the state and federal levels to lift the veil of secrecy from the complex and opaque PBM industry and bring about a more transparent, patient-centered drug delivery system in the United States.

PBMs: The Hidden Middlemen

PBMs are third-party entities that are hired by insurers and health plan sponsors to manage and administer prescription drug benefit plans. They essentially act as middlemen between insurers, drug manufacturers, and pharmacies and thus have a uniquely central role in the drug market, handling everything from setting patient copayment amounts to determining which drugs are covered by which health plans.

Among other functions, PBMs use their intermediary position to negotiate rebates and retroactive discounts with pharmaceutical manufacturers in exchange for including the manufacturer’s drug on the PBM’s tiered formulary, or the list of approved drugs that the PBM will cover in full or part. A drug’s tier placement determines the level of coverage it will receive and therefore how much it will cost patients out-of-pocket and what restrictions are placed on it. PBMs claim to pass a portion of the rebates and discounts they get from manufacturers back to the insurers to help drive down costs for patients, but due to the opaque nature of their contracts, most of these funds appear to go to their bottom line. Unfortunately, there is very little transparency surrounding PBMs and their role within the delivery system, nor are there any requirements to pass negotiated savings onto payers or patients.

Solving the Problem

Given the significant impact of harmful PBM practices, the AACU has joined the Alliance for Transparent and Affordable Prescriptions (ATAP) , a new coalition of patient and provider organizations aimed at addressing pharmacy benefit managers (PBMs) and their impact on drug costs and patient access to affordable treatment. Through ATAP, the AACU is working tirelessly to implement policy solutions that focus on four main objectives:

Increased transparency and appropriate oversight in the rebate system.

Mandated disclosure of rebate information.

Uniform definition of “rebate”, “fee”, other relevant terms.

Reduced costs to patients.

Calculate patient cost-sharing using net price, not list price.

Prohibit clawbacks and pharmacy “gag clauses.”

Improved patient access to treatment.

Formularies based on effectiveness, safety, and ease of administration, NOT rebates.

Formulary transparency.

Non-medical switching restrictions, step therapy regulation, physician overrides.

Regulation and restriction of unfair and deceptive PBM practices.

State licensure/registration, fiduciary duty requirement.

Regulation and transparency standards for PBM payment methodologies.

Share Your Story: Tell Us How PBMs Impact You and Your Patients

The AACU wants to hear how PBMs directly impact urologists and their ability to provide care to your patients. In order to effectively and successfully educate lawmakers about harmful PBM practices, it is imperative that we provide real stories that demonstrate the real-life impact of PBMs on physicians and patients. If you or your patients have been impacted by PBMs, please share your story and help provide a physician and patient voice in the fight to lower drug costs and improve access to affordable and accessible treatment.