UnitedHealthcare to share drug rebates with 7M members; the Trump administration approves, says HHS' Alex Azar

UnitedHealthcare will offer drug rebates directly to some of its members, a move that comes as payers and pharmaceutical companies fight over who's to blame for rising drug prices. 

Beginning in 2019, UnitedHealthcare will expand its pharmacy discounts to about 7 million enrollees who are in fully insured commercial group plans, the insurer announced. The discounts will be applied to prescriptions at the point of sale for drugs where a rebate is offered by the manufacturer. 

With the policy, UHC is addressing a key concern from the pharmaceutical industry, which has claimed that pharmacy benefit managers and insurers pocket much of the discounts from drug rebates drugmakers offer, instead of passing those savings on to consumers. 

Pharma companies have invested a significant amount of resources over the past year to cast blame for rising drug prices on payers and PBMs, deflecting criticisms about how they set prices. The reality is more of a middle ground, according to health policy experts, with both pharma and PBMs sharing part of the blame for increasing drug costs. 

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UHC's new policy also addresses a central element of the Department of Health and Human Services' plans to lower drug prices, which calls for insurers to directly share rebates with members. Payers, including UnitedHealthcare, typically apply drug rebates across the board to decrease premiums instead of offering those rebates directly to consumers. 

HHS Secretary Alex Azar praised the move in a statement, saying UHC's new policy "is a prime example" of what the Trump administration wants to achieve.

"Empowering patients and providers with the information and control to put them in the driver’s seat is a key part of our strategy at the Department of Health and Human Services to bring down the price of drugs and make healthcare more affordable," Azar said. 

"We are already seeing clear momentum toward the type of innovation in the private-sector that will be an important part of the value-based transformation that is coming to America’s healthcare system," he said.

UnitedHealthcare said part of its goal is to simplify its members' pharmacy benefits and improve their care experiences. The change "builds on a history of introducing innovative approaches, products and services that ... enable consumers to directly benefit from the full value of their pharmacy benefits," UHC said. 

"People use their pharmacy benefit more frequently than any other type of benefit, which means pharmacy provides the greatest opportunity for us to understand and meet their needs," Dan Schumacher, UHC's president and chief operating officer, said in the announcement. 

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Industry analyst Adam J. Fein, who studies drug distribution and drug prices, said in a tweet that the announcement is a "major leap forward."