WASHINGTON, July 26, 2017 /PRNewswire-USNewswire/ -- The Pharmaceutical Care Management Association (PCMA) today released a new study, "Value of Direct and Indirect Remuneration (DIR): Impact on Medicare Part D Prescription Drug Plan (PDP) Program Stakeholders," showing that the price concessions that pharmacy benefit managers (PBMs) negotiate with drug manufacturers and drugstores and report to the Centers for Medicare & Medicaid Services as DIR are generating significant savings for the federal government and are projected to save enrollees in standalone Part D plans $48.7 billion on their premiums over the next 10 years.
"Without DIR, Part D premiums and program costs would be much higher," said PCMA President and CEO Mark Merritt.
Click here for the study.
Major findings from the Milliman study:
Total Value of DIR:
- DIR saved the standalone Part D program and its beneficiaries approximately $87.8 billion from the inception of the program through 2016.
- From 2017 through 2026, DIR is projected to save $308.2 billion.
Federal Savings from DIR:
- DIR will reduce the federal government's costs for Part D by a projected $17.2 billion in 2017, a 26.6% savings compared to costs without any price concessions similar to DIR.
- From 2006 to 2016, DIR saved the federal government an estimated $75.4 billion.
- From 2017 to 2026, DIR will save the federal government a projected $259.6 billion.
Premium Savings from DIR:
- Since the inception of the Part D program through 2016, DIR saved Part D beneficiaries an estimated 21.5% on their premiums, a $12.4 billion savings.
- From 2017 through 2026, that savings is projected to increase to an average 33.2% on premiums, or $48.7 billion.
The study assumes Medicare Part D stakeholders do not change their behavior in response to changes in DIR levels.
PCMA is the national association representing America's pharmacy benefit managers (PBMs). PBMs administer prescription drug plans for more than 266 million Americans who have health insurance from a variety of sponsors including: commercial health plans, self-insured employer plans, union plans, Medicare Part D plans, the Federal Employees Health Benefits Program (FEHBP), state government employee plans, Medicaid plans, and others.
SOURCE Pharmaceutical Care Management Association