Drug Pricing Reduction Efforts a Major Issue in 2019

January 02, 2020

In the Administration and in Congress, significant energy was spent working toward solutions to the high costs of prescription drugs which kept a growing focus on the
PBM role in rising costs through Part D DIR charges and Medicaid managed care spread pricing.

Although the Trump Administration did not finalize regulatory action on either Medicare Part D DIRs or drug rebate “safe harbors”, it did draw public attention to the PBM role in raising drug costs for taxpayers.

Congress acted to fill this void by moving three separate bills that take different approaches to reduce drug prices. The House bill H.R. 3 (the Lower Drug Costs Now Act), focuses more on direct Government negotiation. The Senate Finance Committee S. 2543, (The Prescription Drug Pricing Reduction Act of 2019), deals with Medicare and Medicaid.

The Senate Health, Education and Labor (HELP) Committee S. 1895 (Lower Health Care Costs Act) addresses the private markets. Both Senate bills seek to address manufacturer drug costs including PBM spread pricing in both the commercial and self-insured marketplace, as well as Medicaid managed care programs.