UnitedHealth Requires Drug Rebates to Cut Patient Drug Spending

UnitedHealth is expanding its rebate program, which has already cut patient drug spending by $130 per prescription.  

By Sara Heath

March 13, 2019 - UnitedHealth Group and its pharmacy benefits manager (PBM) offshoot OptumRx will be expanding a year-old program set to deliver point-of-care drug rebates and discounts for patients, ideally cutting drug spending for consumers.

The program will build on one that UnitedHealth Group instituted last year that aimed to pass along cost savings to patients, many of whom face extraordinary financial responsibility for their medication expenses.

“OptumRx is uniquely able to deploy the broadest range of tools to rein in high drug prices, and this expanded point-of-sale discount program demonstrates our commitment to delivering better prices for consumers,” said John Prince, CEO of OptumRx, said in a statement.

This latest move will require all employer clients to incorporate point-of-sale rebates for patients into their plan formularies for 2020. Any plans already under construction for January 2020 will be grandfathered into the program, UnitedHealth Group said.

The payer already instituted such a policy at a smaller scale for only some plans starting in January 2019. Thus far, 9 million patients are benefitting from those plans and are yielding cost savings on their medications, UnitedHealth Group reported.

These current programs have already had a positive effect on patient care. After just two months, patients have saved an average of $130 per prescription. And because the program is cutting out-of-pocket patient costs, medication adherence has improved by between 4 and 16 percent, depending upon plan design.

Experts have concluded that the cost of medication is directly tied to medication adherence. When patients struggle to pay for their pills, they often go without.

With these latest plan developments, UnitedHealth Group and OptumRx hope more patients will benefit from drug discounts.

“Patients are seeing concrete benefits from UnitedHealthcare’s groundbreaking point-of-sale discount program, which is just one element in our commitment to help deliver better health, lower costs and a better experience,” said Daniel J. Schumacher, president and chief operating officer of UnitedHealthcare.

“Together with employer partners and OptumRx, UnitedHealthcare has taken innovative action, bringing real value to consumers while mitigating the impact of persistent drug price inflation brought on by drug manufacturers affecting consumers’ ability to afford medications and comply with their physician’s treatment plans.”

This move comes as many healthcare policymakers propose rules that would require payers and PBMs to pass savings from manufacturer rebates onto patient consumers.

A proposal from the Department of Health & Human Services (HHS) would eliminate kickbacks and rebates between manufacturers and PBMs, instead requiring them to offer these discounts directly to patients.

“The proposed regulation would address a perverse incentive identified by the Department by expressly excluding from safe harbor protection under the Anti-Kickback Statute (AKS) rebates on prescription drugs paid by manufacturers to pharmacy benefit managers (PBMs), Part D plans, and Medicaid managed care organizations,” HHS explained in the proposal’s fact sheet.

HHS issued the proposal in an effort to carry out the Administration’s commitment to cutting costs for patients.

“This proposal has the potential to be the most significant change in how Americans’ drugs are priced at the pharmacy counter, ever, and finally ease the burden of the sticker shock that millions of Americans experience every month for the drugs they need,” HHS Secretary Alex Azar said in a statement.

While the HHS proposal applies specifically to Medicare, separate bills have called for similar regulations for the commercial payer industry. A package of legislation introduced by Indiana Senator Mike Braun essentially expanded the HHS proposal to all payer plans.

While the Drug Price Transparency (DPT) Act could reduce out-of-pocket spending for patients, it may have some pitfalls, Braun acknowledged. In place of rebates savings for insurers and PBMs, some experts are concerned patients’ premiums may increase. Any legislation should take that into account, Braun suggested.

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