Pharmaceutical association challenges insurer transparency rule in lawsuit
The lawsuit is challenging a part of the rule requiring pharmacy benefit managers to report the historical pricing data.
A second national organization has filed a lawsuit challenging parts of the insurer transparency rule issued by the Trump administration last October. The action by the Pharmaceutical Care Management Association on Thursday follows a similar suit by the U.S. Chamber of Commerce, Fierce HealthCare reported.
Under the rule, private payers are required to provide patients upfront with pricing that has been negotiated with providers, including real-time cost-sharing data. Beginning in 2023, insurers must offer an online tool that provides out-of-pocket cost estimates for 500 of the “most-shoppable” services. By 2024, that platform must extend to all services.
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Insurers argue that launching these tools would be a costly endeavor that would provide data that confuses consumers. The pharmacy association is directly challenging a part of the rule that would require its pharmacy benefit manager members to report the historical pricing data on prescription drugs. The group said it was not challenging other transparency tenets in the rule.
“These parts of the Trump administration’s transparency rule will drive prescription drug costs higher,” the association said. “By requiring disclosure of ‘historical’ net prices, which are essentially current-year net prescription drug prices, the rule will directly provide drug manufacturers access to their competitors’ negotiated rebates, discounts and price concessions. This in turn will allow drug manufacturers to discount less deeply as they realize their price concessions went beyond those of competitors.”
The chamber’s lawsuit challenges provisions that require pricing data to be made available in a massive, machine-readable file to allow third parties to develop shopping tools for consumers.
“These provisions of the rule threaten to reduce competition, and ultimately raise costs to consumers, by revealing confidential, commercially sensitive information that competitors currently do not share with each other,” the chamber said in its lawsuit. “The required public disclosure of that closely guarded information runs afoul of long-established protections against the forced disclosure of confidential commercial information, including trade secrets, and is detrimental to the business community as a whole.”
Seema Verma, administer of Medicare & Medicaid Services, disagrees with the premises of both lawsuits.
“People are asking for price transparency,” she said. “People are frustrated, and that’s why we’re hearing calls for Medicare for all. Let’s just put it out there. Let patients determine what they need and give them the ability to shop around.”
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