New House bill focuses on Medicare drug price reduction
Thursday, June 07, 2018
The rising costs of drug prices is an issue that many Americans have had to contend with for some time. The out-of-pocket costs that some Americans have to pay for medications can put them in situations where they have to decide between life's necessities or obtaining medications that have the potential to sustain or improve their quality of life.
Currently, there is a proposal in the U.S. House of Representatives that would seek to tackle rising drug prices, especially for those Americans who fall under Medicare Part D, Medicare’s long-existing prescription drug plan.
The mission of the proposed bill, the Phair Pricing Act of 2018, is to have the benefits of lower drug prices with discounts being applied to the drugs that exist in the Medicare drug program rather than these discounts going to the insurers and pharmacy benefit managers.
The belief that the substantial benefits of existing rebates and discounts that are not being shared with average consumers is something that has to be addressed, and hopefully this can be achieved with the new legislation. The goal is to ensure that the majority of price modifications and incentive payments are included for consumers when they purchase their prescription drugs from the pharmacy.
Additionally, the Trump administration recently announced executive action aimed at allowing Medicare to more effectively negotiate drug prices and pressure the pharma industry into greater transparency measures. The administration also claims that these measures can be taken without congressional action.
According to Health and Human Services (HHS) Secretary Alex Azar, "President Trump’s plan to curb drug prices will allow Medicare to negotiate prices in a more aggressive approach."
It is important for Medicare Part D participants to have a level of transparency when it comes to how they are priced for specific drugs that they depend on.
In an effort to assist the various participants of the program, the proposed House bill is working towards providing a drug pricing blueprint and seeks to remove rebate agreements that currently exist for Medicare Part D drugs. It also aims to have more fixed pricing system in place for drug discounts to be provided to consumers.
When consumers reach the point of purchase on their prescriptions, the hope is to have discounts already in place. There will be a high level of drug price transparency as well as changes in the rebate rules, if the bill passes.
While it may be too soon to tell if potential fixed-price discounts in place can reduce drug prices, time will tell if this is an avenue that more and more insurers should adopt.
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