HEALTH CARE BRIEFING: Pharmacy Benefit Managers Targeted by GOP
By Brandon Lee and Alex Ruoff
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House Republicans say Democrats are making a crucial misstep by taking on drug pricing reforms without focusing on the role pharmacy benefit managers play in the rising costs of medicines in the U.S.
The chamber today is scheduled to consider the $1.75 trillion tax and spending package encompassing much of President Joe Biden’s economic agenda.
Democrats have “given a free pass to pharmacy benefit managers even though they play an outsized role in driving up rebates and list prices of prescription drugs,” Rep. James Comer (R-Ky.) said during a forum on PBMs hosted by Republican members of the House Oversight and Reform Committee.
Comer and other Republicans remarked that PBMs—companies hired by insurers to managed prescription drug benefits—reap rewards from rebates, essentially coupons given out by drugmakers, and pharmacy fees. He said both have driven up the cost of many drugs. PBM industry groups have countered that drugmakers themselves are free to set their own prices and should bare responsibility for drug costs.
Democrats, in their proposed $1.75 billion spending bill, take aim at drugmakers by empowering the government to negotiation with pharmaceutical companies for lower prices and capping price increases. Sen. Ron Wyden (D-Ore.), who has played a central role in designing Democrats’ drug pricing bill, told reporters on Tuesday that he wants to add more PBM reforms to the spending bill but declined to offer details.
Comer said if Republicans retake the majority in the House he expects they’ll try to take on PBM reforms, Alex Ruoff reports.
- A potential $10,000 penalty in Democrats’ sweeping spending package for pharmacies that don’t quickly respond to drug cost surveys is prompting backlash from trade groups, which argue Congress should focus instead on the practices of companies setting medication costs. The $1.75 trillion spending bill, which the House is poised to consider this week, says any retail community pharmacy that “knowingly fails to respond” to a National Average Drug Acquisition Cost survey may be subject to the civil monetary penalty—up to $10,000 per day. Celine Castronuovo has more.
- Thousands of nursing homes would be forced to close and thousands of others would have to stop taking new admissions if provisions of the Build Back Better Act become law, industry officials said. House Democrats’ $1.75 trillion package requires nursing homes to have a registered nurse on site at all times. In addition, it would impose mandatory minimum staffing quotas for all facilities a year after HHS conducts a study to determine ideal staffing levels for nursing homes. Tony Pugh has more.
Read the BGOV Bill Summary by BGOV’s legislative analysts.
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- Separately, Biden yesterday announced his intent to nominate Rebecca Jones Gaston for commissioner for the Administration for Children, Youth and Families at HHS, according to a press release.
Vaccine Rule Set for Political Test as GOP Forces Vote: Republicans in Congress are setting up a political showdown on Biden‘s vaccine-or-test rule for private firms, albeit with a vote that’s not likely to actually undo the policy. The entire GOP caucus backed a measure yesterday that would strike the rule, setting up a floor vote as soon as December. GOP Leader Mitch McConnell (R-Ky.) and Sen. Mike Braun (R-Ind.) filed a resolution to repeal the rule through the Congressional Review Act, but Republicans in both chambers would need a veto-proof majority to override Biden’s veto. Courtney Rozen has more.
Senators Want 9/11-Style Commission on Covid-19 Crisis: A bipartisan group of five senators, including Sens. Dianne Feinstein (D-Calif.) and Roger Marshall (R-Kan.), are pushing to include a provision in must-pass defense authorization legislation that would establish a national commission on the pandemic styled after the 9/11 Commission. Such a commission is needed to “better understand the vulnerabilities COVID-19 has revealed in our health care system” and “to improve our overall preparedness for future public health crises,” they said in a letter. Read a statement here.
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The Coronavirus Pandemic
Odds Are GOP-Heavy Panel Hears Shot-or-Test Rule at 6th Circuit: A federal appeals court in Cincinnati could make sure that Republican-appointed judges control the legal challenge to the Biden administration’s vaccinate-or-test rule, making defending the regulation more difficult. The U.S. Court of Appeals for the Sixth Circuit will host the consolidated case against the regulation after being picked on Tuesday in a lottery. The case typically would go before a three-judge panel, which could be composed of a majority of judges who were appointed by Democratic presidents, but that would defy the odds at a tribunal with twice as many Republican-appointed jurists compared to those tapped by Democrats.
But the Buckeye Institute, a conservative Ohio-based think tank, has asked the active-status judges on the Sixth Circuit to break from normal procedure and hear the case. GOP-appointed judges on active status outnumber those selected by Democrats 11-5. The circuit accepted a similar invitation in an abortion-related case earlier this year. Read more from Robert Iafolla.
- As many as 40% of U.S. airport security workers haven’t been vaccinated for Covid-19 as an immunization deadline for federal employees and the busy holiday travel season converge. Many Transportation Security Administration workers are resisting the requirement as the Nov. 22 deadline approaches, said Hydrick Thomas, president of the American Federation of Government Employees’ division representing front-line airport security officers. Thomas estimated those who are hesitant represent about four in 10, though acknowledged he didn’t have hard numbers. Read more from Alan Levin.
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What Else to Know Today
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- White House Office of National Drug Control Policy Director Dr. Rahul Gupta, who was confirmed by the Senate last month as the first-ever physician to serve in the role, will attend his ceremonial swearing in at the White House today, according to a press release.
HHS Seeks Information on Prescription Drug Price Reporting: Employer health plans and other health insurance plans must report on prescription drug and health coverage costs under a rule issued yesterday by four U.S. agencies. The interim final rule issued by the departments of Health and Human Services, Labor, Treasury and the Office of Personnel Management is required under the No Surprises Act and transparency rules in the Consolidated Appropriations Act of 2021. Health plans are required to report information about the most frequently dispensed prescription drugs covered. Read more from Sara Hansard.
HHS Delays Drug Rule Allowing Multiple Prices: The HHS delayed by six months provisions of a Medicaid drug contract rule that lets manufacturers give states different prices for the same products. Drugmakers currently offer the same low price to all state Medicaid plans, which is commonly referred to as a drug’s “best price.” The Trump-era rule could allow companies to offer different discounts to different states without forcing drugmakers to lower the price for everyone. But lawyers said it would have been an administrative nightmare to enforce. Alexis Kramer has more.
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To contact the reporters on this story: Brandon Lee in Washington at blee@bgov.com; Alex Ruoff in Washington at aruoff@bgov.com
To contact the editors responsible for this story: Zachary Sherwood at zsherwood@bgov.com; Giuseppe Macri at gmacri@bgov.com; Michaela Ross at mross@bgov.com
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