Sen. John Kennedy (R-La.) Introduces Legislation to Provide Patients with Savings at the Pharmacy Counter
Mar 05 2019
WASHINGTON, D.C. – U.S. Sen. John Kennedy (R-La.) introduced the Phair Pricing Act of 2019 to lower the costs of pharmaceutical drugs covered under Medicare Part D by ensuring that pharmacy benefit managers and prescription drug plan sponsors pass the savings they negotiate along to their customers
U.S. Representative Doug Collins (R-Ga.) introduced a version of the same bill in the U.S. House of Representatives last month.
Under the Medicare Part D program, pharmacy benefit managers (PBMs) act as middlemen between pharmacies and insurers, negotiating price concessions from pharmacies that they are supposed to pass on to patients to lower the cost of drugs.
However, the Centers for Medicare and Medicaid Services (CMS) has noted that these price concessions are rarely used to lower patients’ costs at the point of sale. The savings usually end up in the PBM’s profits. This legislation directs all price reductions, incentive payments and adjustments between a PBM and a pharmacy be included at the point of sale to decrease the patients’ costs.
Furthermore, this legislation directs the Secretary of Health and Human Services to establish a working group of stakeholders to create quality standards based on a pharmacy’s practice. These standards will help PBMs prioritize patient care.
“If pharmacy benefit managers are negotiating prices with the intent to provide greater savings for consumers, then those savings better be given to the consumers rather than padding someone else’s pockets,” said Sen Kennedy. “This legislation promotes greater transparency and oversight of taxpayer dollars by ensuring that PBMs disclose all fees, price concessions and programs to CMS.”
“For too long, we have turned a blind eye as pharmacy middlemen have manipulated drug prices to maximize their profit margin” said Rep. Doug Collins. “The Phair Pricing Act will guarantee patients at the pharmacy counter directly benefit from lower costs allegedly negotiated on their behalf. I’m thankful for Senator Kennedy’s leadership and I look forward to partnering with him to promote transparency in drug pricing and lower the cost of prescription drugs.”