Health Affairs September 26, 2023
Congress appears poised to pass bipartisan legislation in the coming months that would create new regulations for pharmacy benefit managers (PBMs). PBMs are organizations that negotiate drug prices with pharmaceutical manufacturers and manage prescription drug benefits for an employer or health insurance plan. The core functions of a PBM include setting up a prescription drug “formulary” (a list of which drugs are covered and at what cost), processing pharmacy claims, and managing pharmacy networks and reimbursement. Most PBMs also operate their own mail-order and specialty pharmacies. The three largest PBMs control 80 percent of the market and are each owned by a large insurance company.
This market consolidation, paired with unaffordable drug prices, has led Congress and the Federal Trade...
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