UnitedHealthcare has announced that it will no longer keep the discounts it gets on medical drugs from pharmaceutical companies, and will instead pass on the savings to customers.
The Fortune 500 company based in Minnetonka, which is Minnesota's most valuable company, made the announcement on Wednesday, saying it will benefit 7 million Americans.
The New York Times reports it comes amid "growing frustration" from consumers over drug prices.
Now that UnitedHealth, America's biggest health insurer, is taking this step, expect others to follow.
What is it doing and who will benefit?
The company says that the discounts will apply to 7 million people working for employers who offer UnitedHealthCare's fully-insured commercial group health plan.
It will mean these plan-holders will pay less out-of-pocket when they fill a prescription at their local pharmacy or online.
The savings will vary depending on the plan-holder, but president Dan Schumacher said it could range "from a few dollars to hundreds of dollars to over a thousand."
It won't necessarily cover all medications though, only drugs where UnitedHealth currently gets a discount from its suppliers.
The New York Times notes that drugs like Humira and Enbrel, which treat rheumatoid arthritis, are among those that are heavily discounted, while medicines for rarer conditions – where there's little competition between drug makers – have smaller or even no discounts.
According to the Washington Post, the move will most likely benefit those in high-deductible plans who take "expensive, brand-name drugs."
The discounts will be applied from Jan. 1, 2019, with plan-holders able to check the amount of the rebate they'll be getting by visiting myuhc.com or using the UHC mobile app.