What you need to know 

Effective, Jan. 1, 2025, asthma products were added to the Average Manufacturer Price (AMP) listing to have a rebate credit applied. You may also notice your Q1 2025 rebate payments for insulin and asthma products were lower than they were in 2023. This was the result of the American Rescue Plan Act that eliminated the cap of 100 percent of the AMP for Medicaid rebates. 

Overview 

As previously communicated, the American Rescue Plan Act caused manufacturers to significantly reduce the overall cost of insulin products across all lines of business, creating savings for plan sponsors and members for these important medicines.  

While plan sponsors and members benefit from reduced drug costs for these products, the change also reduced rebates to levels materially lower than anticipated at the time we contracted your plan. 

Key asthma products that dropped a percentage in price on Jan. 1, 2024 include:  

• Advair Diskus – 50% 

• Advair HFA – 29% 

• Symbicort – 40% 

• Asmanex HFA – 50% 

• Asmanex Twisthaler – 50% 

• Duaklir Pressair – 52% 

Due to changes in laws or other significant events, Prime has the right to adjust pricing terms. To ensure fairness, Prime will apply a rebate credit to your rebate guarantee calculation. This will offset any reductions in rebates and maintain balance for both parties. You benefit from the lower total cost of the drug, and the rebate credit helps ensure Prime is not unfairly disadvantaged by the reduced rebate in our guarantee arrangement. 

Next steps 

Your rebates will continue to be paid just as before. However, due to recent price changes, you might notice lower rebate amounts for insulin and asthma. The rebate credit calculation may be reflected in any guarantee reconciliation you may receive.  

Your rebate payments will reflect these reduced insulin and asthma payouts throughout the year, based on your actual insulin utilization during the payment period.   

Frequently asked questions 

1. How is a rebate credit calculated? 

• The current price of the product is subtracted from the original price of the product preceding the price decrease. This is the drug cost savings plan sponsors and members benefit from immediately at the point of sale (POS). 

• The current rebate for the product is subtracted from the original rebate of the product preceding the price decrease. This is the rebate credit. That rebate credit plus the actual (now lower) rebate per claim you earn are combined and applied as “rebates earned” in the guarantee calculation.   

2. What will I see when a rebate credit is applied? 

When a rebate credit is applied, you will see the total amount of the credit, along with the number of claims that contributed to the credit.  

3. What if I don’t want a rebate credit? 

Rebate guarantees can be restated instead of applying a rebate credit. However, we strongly recommend a rebate credit, for the most seamless client experience. There are additional drugs that may drop significantly in price over the coming years as a result of the AMP cap, which could require restating guarantees multiple times — whereas a rebate credit allows us to equitably adjust reconciliations when a product drops in price without disruption.    

Additional questions? 

Please contact your account representative.