Prescription Drug Issues

In an evening email that is sure to ruin the weekend for many, CMS announced on February 5, 2020, that it is proposing changes to the Medicare Advantage and Part D Programs for CY 2021 and 2022. CMS will not issue a Call Letter for CY2021. The unpublished version of the proposed rule is available for inspection, and is scheduled to be published in the Federal Register on February 18, 2020. Comments are due April 6, 2020.
Continue Reading CMS Proposes Changes to the Medicare Advantage and Part D Programs for CY 2021 and 2022

On February 6, 2019, the Office of the Inspector General of the U.S. Department of Health and Human Services (the “OIG”) published in the Federal Register a proposed rule (the “Proposed Rule”) that, if made final in its current form, would (i) amend the Anti-kickback Statute (“AKS”) Discount Safe Harbor to explicitly exclude discounts relating to price reductions or other remuneration offered by a pharmaceutical manufacturer to a Medicare Part D plan sponsor (“Plan Sponsor”), a Medicaid managed care organization (“MCO”), and/or a pharmacy benefit manager (“PBM”) under contract with such a sponsor or organization; and (ii) add two new safe harbors: a “Discounts Offered at the Point-of-Sale” safe harbor (“Point of Sale Safe Harbor”) and a PBM Fee Arrangement Safe Harbor (“PBM Safe Harbor”).
Continue Reading HHS Proposes Rule to Eliminate Safe Harbor for PBM Drug Rebates

California recently passed Assembly Bill 315 to create greater regulatory oversight of pharmacy benefit managers (“PBMs”). [1] The bill requires PBMs to provide more transparency regarding their operations. PBMs will have to register with the California Department of Managed Health Care (“DMHC”) and provide new disclosures to the purchasers of their services. The bill will also establish a new pilot project and task force run by the DMHC to analyze how PBMs are affecting the pharmaceutical market.
Continue Reading The New California Regulatory Scheme for Pharmacy Benefit Managers

Why are prescription drug prices so high in the U.S.? While this question can hardly be considered a new topic in American healthcare, the recent clash of words between the Trump Administration and Democratic Senators has once again brought focus to the issue of prescription drug prices. According to the Administration, pharmacy benefit managers (“PBMs”) and drug distributors – who President Trump has dubbed as “middlemen” – are largely to blame for higher drug prices. However, Democratic Senators, PBMs, and drug distributors have recently pushed back against the Administration’s claims, arguing that the Administration’s claims are not supported by any evidence, and, in some cases, are contrary to the core functions of PBMs and drug distributors.
Continue Reading The Blame Game: Senators Clash with the Trump Administration