Pharmacy benefit managers negotiated $18 billion worth of rebates from drugmakers in Medicare Part D and retained less than 1 percent of those rebates in 2016, according to a recent Government Accountability Office report.
The report from the GAO sought to examine the role of PBMs in the Part D program, including how PBMs earn revenue, trends in rebates and the extent to which plan sponsors use benefit managers. The GAO analyzed CMS data on Part D plans in 2016 for its report.
The GAO also reviewed 20 service agreements between PBMs and Part D plans and found that the primary source of revenue for PBMs was a volume-based fee paid by plan sponsors based on the number of claims the PBM processed for them.
The GAO report also found that the amount of rebates and other price concessions is growing rapidly. From 2014 to 2016, rebates and other price concessions increased 66 percent from $17.5 billion to $29 billion.
The report comes as lawmakers criticize PBMs and insurers for rebates.