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The new Biden administration has started off strong, taking a thoughtful approach to any number of critical health care issues and pulling back a number of new regulations to take a fresh look at these public policy issues. To avoid significant disruption of the Medicare Part D program and avoid a spike in premiums at a time when seniors can least afford it, the administration should pull back the rebate rule, issued at the last minute by the outgoing administration.
Prescription drug rebates are a primary negotiating tool used by pharmacy benefit managers (PBMs) to exert leverage on drug manufacturers to reduce costs. As validated in reports issued by the Government Accountability Office and Health and Human Services Office of Inspector General, rebates are fully passed through from the PBM to the plan sponsor and used to keep premiums low and affordable, which has led to the historic success of the Part D program.
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