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Congress punts on PBM reform efforts

WASHINGTON — Congress has abandoned its attempt to reform how pharmacy middlemen operate in an upcoming package to fund the federal government, 11 lobbyists and sources following the talks told STAT.

It’s a missed opportunity to pass one of the health care priorities that has attracted the most bipartisan interest and activity this Congress, though lawmakers could revive the negotiations on the issues in the future.

Reforming how pharmacy benefit managers operate has been a top lobbying priority for the pharmaceutical industry since Democrats passed a major package aimed at lowering the costs of medicines in 2022. Pharma and PBMs have taken up a very public battle on the airwaves.

The PBM reform legislation was expected to be a potential way to offset the costs of a separate effort to renew expiring funding for safety-net hospitals, community health centers, and other public health programs. Negotiations over a final deal to extend those programs are ongoing. Additional health deadlines will be coming up later this year, which could provide additional opportunities to pass PBM reform.

Both the House and the Senate have been working on PBM reforms in recent months. The most comprehensive proposal came from the Senate Finance Committee. Its package would require that PBMs in Medicare charge flat services fees that aren’t based on drug list prices. It would also tie patient cost-sharing to net prices for some patients with chronic conditions, require more disclosure, and ban PBMs from charging Medicaid more than they pay for drugs (a practice called spread pricing).

The Senate health committee passed legislation to ban PBMs from using so-called spread pricing in the commercial market. It would also require that the middlemen disclose rebates, fees, and other payments they receive and to pass them on to the insurers for whom they negotiate those concessions.

The full House of Representatives passed a few policies mostly focused on increasing transparency. The bill would ban PBMs from spread pricing and would codify Trump-era rules that require hospitals and insurers to publicly post their prices. PBMs, clinical lab test providers, imaging providers, ambulatory surgical centers would have to be more transparent about their pricing, too.

However, in November the Energy and Commerce Committee also explored policies that would decouple PBM fees from drug prices, ensure seniors don’t pay more for drugs than insurers, and speed the uptake of biosimilars.

There’s also a separate effort by the House Oversight Committee to stop PBMs from charging fees based on list prices to insurance provided to federal employees.

 

Read More at STAT.