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house Bill H.R. 2115

Should Pharmacy Benefit Managers’ Aggregate Rebate Data & Dispensing Rates be Public?

Argument in favor

The shady nature of pharmacy benefit manager (PBM) negotiations and the deals they strike with manufacturers leave patients in the dark as to whether they’re paying the best possible price for their medications. Requiring public reporting of information PBMs already provide to the government is a small way to make them more accountable for their business practices.

David 's Opinion
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10/29/2019
Transparency helps keep people, and businesses, honest. There is no better reason to pass this bill.
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John's Opinion
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10/29/2019
Universal single payer healthcare, cradle to grave!
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Karen's Opinion
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10/28/2019
Transparency is crucial in understanding where the healthcare system is broken and indicates where we go to course correct. It is nothing short of diabolical that life saving drugs like insulin, widely used and on the market for years, have had such a tremendous rate hike. Morbidity and mortality rates have risen among diabetics. We have to start setting pricing standards like other countries do. There is absolutely no reason, no excuse, for exorbitant rate hikes—medicines should be affordable fir everyone. Healthcare is not a commodity, fair and affordable healthcare is a right.
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Argument opposed

This bill is ineffective and harmful to PBMs’ businesses, which ultimately make it harder for consumers to affordably access medications. It’s ineffective because it isn’t paired with government negotiation or other ways to ensure PBMs price drugs fairly. From PBMs’ perspective, it’s potentially harmful to their business because it makes industry information public.

John's Opinion
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10/29/2019
I think they should solve price gouging instead of making rebate info public
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RGlbk's Opinion
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10/29/2019
Do we really thing the truth will told? Democrap liberals wasting America taxpayer dollars! Vote the democraps out!
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Just.Dave's Opinion
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10/29/2019
No, this federal oversight will cost more money, therefore increasing the cost of medications or at the very least increase our taxes... Just cut the cost of medications without increasing costa in other ways.
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bill Progress


  • Not enacted
    The President has not signed this bill
  • The senate has not voted
      senate Committees
      Committee on Finance
  • The house Passed October 28th, 2019
    Roll Call Vote 403 Yea / 0 Nay
      house Committees
      Committee on Energy and Commerce
      Health
      Committee on Ways and Means
      Health
    IntroducedApril 8th, 2019

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What is House Bill H.R. 2115?

This bill — the Public Disclosure of Drug Discounts Act — would increase drug pricing transparency by requiring the U.S. Secretary of Health and Human Services to publicly post aggregate rebate data and generic dispensing rates separately by each pharmacy benefit manager (PBM). This is data that PBMs must already report by law. 

Information on rebates by class of drug would be made publicly available, so long as the disclosure does not display confidential information regarding rebates achieved for an individual drug or plan level. 

To preserve the confidentiality of proprietary information, the information would be required to be aggregated by drug class, but only if the Secretary determines the number of drugs in a class is sufficient to meet the confidentiality requirement. Further, data would only be made available two years after the fact.

Impact

Prescription drug users; pharmacies; health insurance companies; and pharmacy benefit managers.

Cost of House Bill H.R. 2115

A CBO cost estimate is unavailable.

More Information

In-DepthRep. Abigail Spanberger (D-VA) introduced this bill to require increased transparency of third-party intermediaries for drug discount negotiations

“In Central Virginia and across the country, Americans are paying increasingly higher prices for lifesaving medication—and it is a crisis for families and patients, especially those living with chronic illness and the elderly. I was proud to introduce this bipartisan bill meant to address one of the root causes of this crisis and to increase transparency within the murky world of prescription drug negotiation. By requiring that PBMs report their rebates, discounts, and price concessions, we are casting sunlight on a system that has significantly contributed to rising drug prices—and we’re giving patients, physicians, and employers the opportunity to understand how they are impacted by PBMs. With today’s passage of our bill out of committee, we are making significant progress—and I’ll keep fighting to lower drug prices and bring transparency system that hurts chronically ill and aging Americans.”

Pharma critics warn that pricing transparency alone won’t fix the problem of high drug prices. At a May 2019 House Energy and Commerce Committee hearing on drug pricing transparency, Frederick Isasi, executive director of the patient advocacy group Families USA, said the question is, “Is it just transparency or is it transparency with teeth?" He added, "The government needs to say: This is not a fair price; we will not pay it. We have to combine both these things together."

At the same May House Energy and Commerce Committee, hearing, Kristin Bass, chief policy and external affairs officer of the Pharmaceutical Care Management Association, which represents PBMs, argued against making company-specific negotiations public. Bass contended that making this information public could jeopardize negotiations with manufacturers. Bass also defended the practice of PBMs pushing higher list-price drugs in their formularies, drawing higher rebates.

This legislation has three bipartisan cosponsors, including two Democrats and one Republican.


Of NoteThe discrepancy between what patients pay out of pocket and what drugs actually cost is frequently created by “pharmacy benefit managers” (PBMs), companies hired by insurers to manage drug benefit programs and act as intermediaries between insurers, manufacturers, and pharmacies. 

Currently, the three largest PBMs control nearly three-quarters of the U.S. prescription drug market. These powerful third-parties are responsible for negotiating rebates with manufacturers for Medicare Part D plans and other insurers. Medicare Part D plans provide beneficiaries with insurance coverage for prescription drugs, but the negotiations surrounding these drugs and their list prices are not transparent.

PBMs use their position to negotiate discounts, rebates, and other cost reductions from pharmaceutical companies in exchange for their drugs’ preferred placement on insurers’ formularies. The difference in price between the original price and the negotiated price, known as the “clawback,” is supposed to be passed on to patients — however, excess rebates and fees are often retained by PBMs rather than being passed on to patients. Consequently, patients’ out-of-pocket costs may not reflect the actual lower price of the drug.

As an example of how this might work

  • A manufacturer might originally price a drug at $100. Then, a PBM negotiates that price down to $80. A pharmacy then purchases the drug from a wholesaler and the PBM pays the discounted rate to the pharmacy. The pharmacy pays a fee to the PBM for the negotiating service based on the drug’s list price ($100, rather than $80), bringing extra profit to the PBM. 
  • The PBM may then charge the insurer a higher price for the drug ($90), even though it reimburses the pharmacy at the negotiated price. Simultaneously, the PBM also earns a rebate directly from the drug manufacturer for placing the drug on its formulary. 
  • Finally, when a patient buys the drug from the pharmacy, he or she is charged a copay amount based on the list price ($100) rather than the negotiated price ($80). The co-payment may be higher than the cash price, and pharmacists are often prohibited from informing patients about this potential cost-saving opportunity due to PBM contracts.


Media:

Summary by Lorelei Yang

(Photo Credit: iStockphoto.com / esolla)

AKA

Public Disclosure of Drug Discounts and Real-Time Beneficiary Drug Cost Act

Official Title

To amend title XI of the Social Security Act to provide greater transparency of discounts provided by drug manufacturers.

    Transparency helps keep people, and businesses, honest. There is no better reason to pass this bill.
    Like (32)
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    I think they should solve price gouging instead of making rebate info public
    Like (5)
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    Yes this information should be available. However, I think this should be part of a broader and more comprehensive package that addresses prescription pricing generally. I feel that Congress often wastes too much time tackling the little piece-parts of what should be more strategic comprehensive legislation that addresses the core issue- in this case the cost of medicine. I think that all elements contributing to this goal should be combined to assure that all of the piece-parts make sense, are affordable, contribute to the overall goal and do not have unexpected consequences. I would prefer that Congress generally takes on the big problems and not just the parts that may contribute. Oh for the day’s of actually debating meaningful legislation that truly addresses long-term needs.
    Like (42)
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    Universal single payer healthcare, cradle to grave!
    Like (23)
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    Transparency is crucial in understanding where the healthcare system is broken and indicates where we go to course correct. It is nothing short of diabolical that life saving drugs like insulin, widely used and on the market for years, have had such a tremendous rate hike. Morbidity and mortality rates have risen among diabetics. We have to start setting pricing standards like other countries do. There is absolutely no reason, no excuse, for exorbitant rate hikes—medicines should be affordable fir everyone. Healthcare is not a commodity, fair and affordable healthcare is a right.
    Like (11)
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    Yes, pharmacy rates/rebates should be transparent. I would even like to see what our neighbors in Mexico and Canada are paying for the same drugs. Sometimes, it's worth a trip. :) The pharmaceutical company's price hikes in this country are pure evil. It sickens me every time I hear that someone died because they could not afford their medications. Medicare For All would allow our government to negotiate those prices, and get rid of the excess profit margins. Healthcare is a right for all!
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    This is a step in the right direction.
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    PBMs are a MAJOR reason our system is so dysfunctional and expensive!!!
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    The pharmacy benefit manager (PBM) negotiations has been very shady and their deals with manufacturers put patients in the dark about if they’re paying the best possible price for their medications. Public reporting of PBMs would provide the government with way to make the PBMs more accountable for their business practices. This would be a start toward creating regulations that make prices the same everywhere & controls those prices, just like all other countries do.
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    The facts are that the price of staying healthy in this country is outrageous. But that's not because there isn't any competition. There are a few things wrong with the system. Pharmaceutical costs are one. Tests and procedures are the other. Now, BIG pharma pumps Millions if not Billions into the CRIMINALS we elect in Washington. So when votes come up to try and get medical costs under control, be it medicine, tests or actual care, the Criminals we elect, water down the legislation because of the CASH they receive from the medical "industry" lobbyists. The BOUGHT and PAID FOR POLITICIANS simply do the bidding of their masters in the medical "industry." OH and YES! When did health care become an "industry?" When Lyndon Johnson started handing out MEDICAID CARDS like they were "Library cards" to the slackers on welfare. TRILLIONS of dollars in taxpayer money went to the "Health Care Industry" for everything from Flu Shots to Abortion procedures. Doctors bilk Medicaid and Medicare for big cash for a 20 minute office visit. Go to a hospital? EVERY ASPECT of your care is run by PRIVATE CONTRACTORS who work inside the Hospital. You get up to 10 DIFFERENT BILLS for everything from the X-ray technician to the person who hands you an Aspirin. Then the cost of "Health Insurance" and co-pays continue to rise. the FALSEHOOD that was "OBAMACARE" did little to get people insured. It DID LESS to get the cost of health care under control. In fact, if OBAMACARE DID ANYTHING? IT INFLATED THE COST OF THE ACTUAL CARE BY AT LEAST %35! As greed driven for profit Hospitals and Health Care companies sprung up like WEEDS to get in on the FEEDING FRENZY that OBAMACARE offered. So to with the "Health Insurance Providers." Where there were about 5 major Health Insurance Companies, there are now about 25. ALL of whom are vying for a piece of the pie. Then finally, we have the "Mal Practice" insurance Doctors and Hospitals are forced to carry. The problem here is that the FILTHY AMBULANCE CHASING LAWYERS are actually advertising on TV 100 times a day to get you to call in for your shot at free cash. OH, Doctor implanted a surgical mesh to close a hernia and it didn't work because the patient put on 100 POUNDS and it ripped open? SUE THE DOCTOR, THE HOSPITAL and MANUFACTURER for the patient eating FAST FOOD 5 times a day. ALL of this contributes to the rising cost of health care and health insurance.
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    Do we really thing the truth will told? Democrap liberals wasting America taxpayer dollars! Vote the democraps out!
    Like (4)
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    Every measure to add sunshine and accountability to the shady drug pricing schemes is welcome. But, this is a tiny action in a very big cesspool. We need comprehensive review of drug and healthcare service pricing in this country. A pharmacy pricing bill should be grounded in what is in THE PATIENT'S interest and include: 1) Authorize all Federal payers to have what the VA has: the ability to control it's formulary and negotiate prices directly. 2) Regulate (as in Insurance commissions) to stop allowing the unreasonable pumping of prices of otherwise cheap off patent drugs so they can be used to sell rights between corporate entities. 3) Prohibit contracts between pharma companies that pays a potential competitor NOT to produce in order to maintain monopoly status. 4) Prevent public extortion by prohibiting pricing based on the lethality or morbidity of the consequence if it were not used. i.e. 5) Regulate: (as an insurance commissioner does) by requiring documentation that justifies the extraordinary cost of newer drugs based on overall research and production costs incurred, given market volume expected. A drug that costs 50-100,000.00 per dose. IN SUM: Stop saying we can reform healthcare systems without reforming and lowering drug pricing. Medicare will be broke in 2023.
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    You bet. Their claims about the difficulties of their business needs to be exposed.
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    How is it we can agree on Freaking Pharmacy and not agree on Donald Trump being an active foreign agent??
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    Normally, I am a libertarian, but on this issue, PBMs are overpricing Americans and should be exposed.
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    seems helpful to regular ppl. takes power away from corporations etc.
    Like (2)
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    0 My Public Comment ··· Today at 10:54 PM PBMs are robbing Americans, with help from Pharma and Insurers, by rigging the system so that they receive outrageous secret legalized kickbacks. This practice is intentionally opaque and complex to sustain it. What other industry has middlemen pocketing money in the form of kickbacks? How did we function before PBMs - ExpressScripts, CVSCaremark, and OptumRX - entered as superfluous middlemen? I’m old enough to remember when patients paid a higher copay or portion for more expensive branded drugs and lower for generics. That’s a free (or closer to free) market system whereby the consumer has skin in the game. It allows for competition and drives prices down. Generics were predictably less costly. Drug prices were actually reasonable. The past 5+ years have proven to be disastrous. PBMs incentivize Pharma to INCREASE their list price, competing for top tier placement on insurance formularies, because PBM kickbacks are based on the list price- the higher the list price the more these unnecessary middlemen pocket. Our legislators must act. Delayed, partial transparency may be a token step forward I’m afraid and simply kick the can down the road, but transparency is needed. This is no longer under the radar. Prescribing physicians know. Patients know. Legislators know. I thank Senator John Cornyn and others for pushing for transparency and an end to this malarkey.
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    No, this federal oversight will cost more money, therefore increasing the cost of medications or at the very least increase our taxes... Just cut the cost of medications without increasing costa in other ways.
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    It is important to see see how money drives the insurance and drug industry. I have worked for third party insurance companies for 30 years, I know this is not a healthy or ethical way to run our healthcare systems.
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    I’d vote yay. It’s a start, we need more transparency in the business of medications and costs. Other nations offer lower prices to consumers on life saving meds like Insulin we can and should too.
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