Rebates fully passed through to the sponsor are not a violation
What the document says“even if such price concessions are calculated as a percentage of a drug's price, shall not be considered a violation of the requirements of clause (i) if they are fully passed through to a PDP sponsor and are compliant with all regulatory and subregulatory requirements related to direct and indirect remuneration”
Rebates, discounts and other price concessions a manager or affiliate receives from manufacturers do not violate the fee rule, even where they are figured as a percentage of a drug's price, so long as they are fully passed through to the sponsor and comply with the direct and indirect remuneration requirements, including where a sponsor is acting as its own manager.
What the document actually says“even if such price concessions are calculated as a percentage of a drug's price, shall not be considered a violation of the requirements of clause (i) if they are fully passed through to a PDP sponsor and are compliant with all regulatory and subregulatory requirements related to direct and indirect remuneration”
A cut of a drug's price does not break the rule above. It must be handed on to the plan in full. It must also follow the other rules.
A rebate is money a drug maker gives back. If the middleman keeps it, it is income. If it goes to the plan, the plan can lower costs.
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