Prominent proposals to improve the affordability of Medicare Part D prescription drug coverage would have pharmaceutical manufacturer rebates shared directly with the consumer at the point of sale (POS). While Part D plans can voluntarily offer this approach, premiums under a voluntary POS system will likely be rather high relative to market averages. This report explains why a requirement that all plans use POS rebates would produce much more modest premiums.

This report was commissioned by The Pharmaceutical Research and Manufacturers of America (PhRMA).