Pharmacy Benefit Manager Reform: What’s on the Horizon? (December 2023 Update) - McDermott+Consulting

Pharmacy Benefit Manager Reform: What’s on the Horizon? (December 2023 Update)

The price of prescription drugs has brought scrutiny to the entire drug supply chain. Congress and other policymakers continue to seek opportunities to lower costs for patients and the federal government.

Pharmacy benefit managers (PBMs) are a key stakeholder in the drug supply chain, functioning as intermediaries between insurance providers and pharmaceutical manufacturers. PBMs administer prescription drug benefits and seek discounts for insurers as standalone plans, such as Medicare Part D standalone plans and commercial plans, including Medicare Advantage (MA), Medicaid Managed Care Organizations and employer-sponsored health plans.

Congress and other stakeholders are raising questions about PBMs’ operations and their impact on drug prices and out-of-pocket costs for patients. In the 118th Congress, six key committees have advanced legislation that would increase PBM transparency and reporting obligations and modify other business practices. In the House, three committees combined to introduce H.R. 5378, the Lower Costs, More Transparency Act, which passed the House December 11, 2023. Read on as we review and compare policies in the Lower Costs, More Transparency Act and the PBM bills considered individually by the relevant House and Senate committees.