PBM drug pricing transparency reform bill headed to the full Senate
The bipartisan pharmacy benefit manager bill, which was approved by a Senate committee, would make it illegal to charge health plans and payers more for a prescription drug than what PBMs reimburse to the pharmacy.
A bipartisan pharmacy benefit manager reform bill was approved in a Senate committee last week and sent to the full Senate.
“This bipartisan bill would not only put a stop to deceptive and opaque pricing schemes that burden consumers with higher prices, it also saves taxpayers $740 million,” said Sen. Charles Grassley, R-Iowa, who introduced the legislation with Sen. Maria Cantwell, D-Wash. “It’s a win-win and warrants swift approval in Congress.”
The Senate Committee on Commerce, Science and Transportation approved the Pharmacy Benefit Manager Transparency Act by a vote of 18 to 9. Among the provisions of the bill:
- It would be illegal for PBMs to engage in “spread pricing” in which they charge health plans and payers more for a prescription drug than what they reimburse to the pharmacy.
- Clawing back payments made to pharmacies or increasing fees or lowering reimbursements to offset reimbursement changes in federally funded health plans would be prohibited.
- PBMs would be required to pass 100% of any rebate to the plan or payer and disclose the cost and reimbursement of drugs to the health plan.
The bill would reduce the budget deficit by $740 million over the next decade, according to a Congressional Budget Office estimate.
“Drug prices have been increasing at an alarming rate and are compromising consumers, their budgets and the cost of health plans,” Cantwell said. “Pharmacy benefit managers are middlemen in the drug pricing supply chain and today, three PBMs control 80% of the prescription drug market, operating out of the view of regulators.”
Many health care and consumer organizations have expressed support for the bill.
“The Pharmacy Benefit Manager Transparency Act would go a long way toward addressing PBMs’ anticompetitive business practices that are putting many independent pharmacies out of business and creating ‘pharmacy deserts’ in minority and underserved communities, where the neighborhood pharmacy may be the only health care provider for miles,” it wrote in support of the bill.
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However, the Pharmaceutical Care Management Association, which represents PBMs, has said in the past that PBMs play a positive role in securing savings and provide choice and expertise for employers about prescription drug benefit design and coverage.
Leadership has not announced if and when the full Senate will consider the bill. The committee passed the same bill last year by a margin of 19-9, but never was put on the Senate floor for a full vote. “While there does seem to be momentum for PBM reform in this Congress, it remains to be seen whether this particular bill will see any further action,” according to an Axios report.