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A pharmacy benefit manager (PBM) is generally an administrator within a prescription drug program for persons in the United States of America. The PBM may also work for an integrated health care system such as the Veterans Health Administration (VHA). The PBM has the primary responsibility of processing and paying for prescription drug claims. The PBM also contracts with pharmacies and negotiates discounts and/or rebates with drug manufacturers. Of particular interest, the PBM must develop and maintain “the formulary,” which is the list of pharmaceuticals preferred by the specific health plan for which the PBM works.

There are a variety of programs administered by PBMs. Examples include pharmaceutical benefits covered through employment health policies (such as Kaiser), Medicare Part D, the Federal Employees Health Benefits Program, ...

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