Despite Trump's Aggressive Statements Toward Pharmacy Benefit Managers, GOP House Members Grant Them Immunity
During the same week, President-elect Trump expressed his desire to "eliminate the middleman," the Republican-led U.S. House of Representatives did not incorporate pharmacy benefit manager (PBM) reforms into a crucial government financing bill.
The House, governed by Republicans, eliminated language from the funding legislation that aimed to intensify PBM regulation. These companies, often referred to as intermediaries between drug manufacturers and consumers when it comes to medicine procurement, manage drug benefits for employers and government health insurance programs such as Medicaid for low-income Americans and Medicare for seniors.
In these roles, PBMs also determine the payment for pharmacists and pharmacies dispensing prescription drugs. Nevertheless, pharmacies have been closing nationwide in recent years, with their owners partly blaming a reimbursement squeeze from the PBMs that pay them.
PBMs have been under scrutiny recently as people, taxpayers, and Congress question whether they are passing on sufficient savings to health plan subscribers. The clamor for PBM regulation and the companies that control them grew louder after Trump stated, "we’re going to eliminate the middleman," referring to these companies.
"The detestable middleman who earns more, frankly, than the drug companies, and they don’t do anything except they’re a middleman," Trump stated. "I don’t know who these middlemen are, but they are wealthy."
Originally included in a "continuing resolution" before it was removed later in the week was a "provision that would require PBMs to reimburse pharmacies at [National Average Drug Acquisition Cost] plus the state's fee for service dispensing fee for all Medicaid managed care programs in all 50 states," stated the National Community Pharmacists Association, which represents over 18,900 pharmacies. "It would eliminate spread pricing and pay PBMs a flat administrative fee in all Medicaid managed care programs. The provision will save taxpayers approximately $1 billion over the next 10 years."
The pharmacy lobby added that the legislation would have required the Centers for Medicare & Medicaid Services "to establish reasonable and relevant contract terms, including pharmacy reimbursements, in Medicare Part D and create a mechanism for pharmacies to dispute contract violations and penalize PBMs."
However, Democrats attributed the removal of PBM reforms from the legislation to Republicans and a supposedly cozy relationship they have with PBMs and health insurers. Three of the largest PBMs are owned by UnitedHealth Group, CVS Health, and Cigna, which also operate health insurance companies.
"A CR that includes health provisions but excludes bipartisan PBM reform is an embarrassing capitulation to the health insurance lobby," U.S. Rep. Jake Auchincloss, a Massachusetts Democrat, said in a post on Twitter Thursday afternoon. "GOP leadership just backed down from the fight to lower prescription drug costs."
The removal of PBM reforms from the legislation was criticized by Democrats, who believe it was a concession to the health insurance lobby, as three of the largest PBMs are owned by companies like UnitedHealth Group and CVS Health. Despite the Republican-led House not incorporating PBM reforms into the funding bill, the clamor for regulation of these Pharmacy Benefit Managers (PBMs) and the companies that control them, such as CVS Health and Cigna, has grown louder after President-elect Trump's statements.