Pharmaceutical Benefit Management (PBM) and its Implication for Japan's Health Insurance Reform

Okamoto AtoZ, Johnson Kathleen A.

doi:10.4091/iken1991.7.3_150

Pharmaceutical Benefit Management (PBM) is a rapidly growing form of managed-care in the U. S. health care market. It evolved from a need to achieve better treatment outcome while assuring cost-effective use of drugs.<BR>Because of economic incentives inherent in Japan's health insurance system, Japan's pharmaceutical expenditure is higher than most western countries. Numerous proposals are being discussed to reduce pharmaceutical expenditures, which tend to concentrate on increasing patients' copayments. A higher copayment will certainly reduce pharmaceutical expenditures, but may not be able to improve health outcomes and the effectiveness of pharmaceutical use.<BR>In this article the authors look at PBM as a potential alternative to Japan's health insurance reform and will review its functions in light of the applicability of the same concept to Japan's health care market with particular emphasis being given to the legal implications of antitrust law when PBM services are provided by pharmaceutical manufacturers.<BR>The conclusions were that although the PBM concept is not possible under Japan's current health insurance system, deregulation measures to permit individual insurers to contract with providers (hospitals, clinics, pharmacies) over formulary, price and utilization as proposed in the current reform agenda will make PBM an attractive alternative to increased patients' copayment.

Pharmaceutical Benefit Management (PBM) and its Implication for Japan's Health Insurance Reform

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