The Trump Administration has decided against finalizing a controversial proposed Office of Inspector General (OIG) regulation that would have modified Federal Anti-Kickback Statute safe harbor protection for certain prescription drug rebates to health plans and pharmacy benefit managers (PBMs). As we previously reported, the proposed rule would have (i) removed safe harbor protection for drug manufacturer rebates to Part D plans, Medicaid managed care organizations, and PBMs acting under contract with either type of entity, (ii) establish a new safe harbor protecting manufacturer “point of sale” price reductions on Part D and Medicaid managed care drug utilization, and (iii) establish a new safe harbor protecting certain service fees paid by drug manufacturers to PBMs.

According to the White House Office of Management and Budget (OMB), the OIG officially withdrew the pending final rule on July 10, 2019. Action to end consideration came after release of a Congressional Budget Office estimate that the rule as proposed would increase federal spending by about $177 billion over the 2020–2029 period while increasing beneficiary Part D drug plan premiums.