Here are four things to know:
- A recent bipartisan budget bill aimed at reforming PBM practices, including transparency and decoupling their compensation from drug rebates was scrapped after opposition from President-elect Donald Trump allies. While the reforms are no longer a part of the legislation, the issue remains on the table.
- Despite the bill’s failure, both Democrats and Republicans including President-elect Trump are increasingly critical of PBMs, signaling intent to address the business model in future legislative efforts.
- One proposed change would have required PBMs to pass 100% of the rebates they collect from drug manufacturers to employer health plans. Critics argue that PBMs prioritize high-list price drugs to maximize their rebate revenue, inflating costs for consumers, according to the news outlet.
- PBMs have shifted away from relying on rebates, which now account for just 13% of their profits compared to 46% a decade ago. They now generate more revenue through administrative fees, many of which are through international organizations.
