September 28, 2018

Is Your Work Getting Rebate Bucks from Your Chronic Condition

I have ranted about PGM rebates a lot. One big question is who gets the money? It may be the company you work for.

Quick Rebate Refresher.
When people with insurance get a drug at the pharmacy there is a lot of money changing hands behind the scenes. Your insurance policy doesn't pay the retail price. They get a rebate. It can be a big chunk of the price. They often get that rebate even if you haven't met the deductible and you pay the full retail. Some of that flows back to your insurance to 'help hold down the cost of coverage." A recent article suggests that most of it flow back. 

So you may have a high deductible to hold down the cost of coverage, and they get huge chunks of what you paid for medicine before meeting that deductible to help hold down the cost of coverage too. Double whammy or reverse insurance.

As Drug Channels Explained
Put another way, the PBMI data demonstrate that employers operate their pharmacy benefits like reverse insurance. Employees and their dependents taking medicines for chronic, complex illnesses generate the majority of manufacturer rebate payments. These funds are used primarily to offset total plan costs for the employer, not to offset the costs incurred by the patients whose prescription activity generates those rebates.
Paying rebates at the point of sale would put the rebate and the usage together so that patients benefit from the rebates paid on the drugs they use. Or the whole system could just be eliminated as the kickbacks they look like.