“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness..”. Against a backdrop as politically charged as Dickens’ A Tale of Two Cities, Congress’ latest attempt to make headway in the drug pricing debacle has resulted in two bills aimed squarely at drug manufacturers while appearing to largely overlook the now well-documented role pharmacy benefit managers (PBMs) play in escalating medication costs.
HR 3, the “Lower Drug Costs Now Act” was introduced by Speaker Nancy Pelosi with the intention of reining in rising drug prices, holding manufacturers to a price cap based on the average price of a selection of brand name medications sold to Australia, Canada, France, Germany, Japan and the United Kingdom. The bill would theoretically lower drug prices for Medicare enrollees by allowing the Centers for Medicaid and Medicare (CMS) options for negotiating pricing in line with that of other countries.
HR19, the “Lower Costs More Cures Act” introduced by Rep. Greg Walden (R-OR), also attempts to hold drug prices in check but without the government-imposed price controls. HR 19 appears to at least acknowledge certain PBM practices by including provisions calling for drug pricing transparency, a study of “pharmaceutical supply chain intermediaries and merger” and the end of “abusive spread pricing”. But like the “Pelosi Drug Bill”, it fails to address one of the central most drivers of the high prices consumers pay at the pharmacy counter: true PBM oversight and regulation.
As of last week, HR 3 has passed the House and will head next to the Senate, where it is expected to be defeated. Meanwhile the Senate Finance Committee’s “Prescription Drug Pricing Reduction Act” (the “Grassley-Wyden” bill), has been fortified to include prohibiting the PBM practice of collecting post-transaction “retroactive fees” from pharmacies, but does little to address the practice of extracting “pay to play” rebates from manufacturers in exchange for product placement on plan formularies. In its current format, the Grassley-Wyden bill is not expected to make it to the Senate floor for a vote in the near future.
Our take on the situation:
The shady, “proprietary” and “trade secret” factors that contribute to skyrocketing medication prices are a non-partisan problem that touches every American whether enrolled in Medicare, Medicaid or a private commercial health plan. By failing to directly address the well-documented profiteering tactics of a handful of Fortune 25 corporate bad actors, Congress is failing us: the small business pharmacy providers, the patients and the taxpayers.
“..It was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair … in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only,”
To be clear, we are not ungrateful. But while we commend our federal legislators for the fair start, the fact is unless they write bills and cast votes with their consciences instead of their PAC pocketbooks, nothing will change.
We need true PBM reform, an overhaul at the state and federal level that either greatly regulates or removes PBM middlemen from the healthcare equation. Anything less will only prolong the problem.