Pharmacy benefit managers have garnered a lot of criticism recently as the nation tries to find long-term solutions to drive down drug prices, but a new model could do the middlemen and consumers some good, John Arnold with the Laura and John Arnold Foundation writes in a recent article published on STAT.
Arnold notes PBMs originated from the hope that their “buying power could reduce health care costs and pass the savings on to consumers.”
However, their revenue model, which relies on fees, rebates and pharmacy spreads, has produced some criticism over concerns from insurance companies that the PBMs are failing to pass off the savings from rebates.
“In Medicare, the Medicare Payment Advisory Commission has consistently raised concerns that pharmacy benefit managers are not choosing the lowest-cost drug,” Arnold writes.
PBMs, Arnold writes, have the potential to “provide significant value,” but a new business model must be developed which puts more focus on the interests of payers and patients.
“It is easy to cast pharmacy benefit managers as the bad guys of drug pricing, but with changes to the basic business model, they may be consumers’ best hope for holding down the price of pharmaceuticals,” Arnold writes.