A flat incentive payment counts as a bona fide service fee
What the document says“shall be deemed a `bona fide service fee' (even if such payment does not otherwise meet the definition of such term under paragraph (7)(B)) if such payment is a flat dollar amount, is consistent with fair market value (as specified by the Secretary), is related to services actually performed by the pharmacy benefit manager”
An incentive payment, as the Secretary determines, made by a sponsor to a manager or its affiliate is treated as a bona fide service fee where it is a flat dollar amount, is consistent with fair market value as the Secretary specifies, relates to services actually performed for the sponsor in connection with part D drugs, and meets any further requirements the Secretary sets.
What the document actually says“shall be deemed a `bona fide service fee' (even if such payment does not otherwise meet the definition of such term under paragraph (7)(B)) if such payment is a flat dollar amount, is consistent with fair market value (as specified by the Secretary), is related to services actually performed by the pharmacy benefit manager”
Such a payment counts as a true service fee. It must be a flat sum. It must match a fair market price. It must be for work really done.
A flat sum does not move with a drug's price. So it does not push the middleman toward costly drugs. That is the point of the test.
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