On Oct. 28, 2019, the U.S. House of Representatives unanimously passed two bills that, if enacted, require public disclosure of the discounts drug companies provide to pharmacy benefit managers (PBMs).

The Public Disclosure of Drug Discounts Act, H.R. 2115:

Posting Aggregate Data: Beginning Jan. 1, 2020, this legislation would require PBMs to report their aggregate rebates, discounts, direct and indirect remuneration fees, administrative fees, and price concessions that are passed through to plan sponsors. In addition, the bill would require the secretary of the Department of Health and Human Services to post that information on the department’s website. It would apply to Medicare and plans offered on the Affordable Care Act exchanges.

The bill's goal is to obtain more data to address concerns that PBMs may be contributing to higher drug prices by favoring high-list-price drugs with large rebates. The information would be displayed in a way that does not identify an individual drug or an individual plan.

The increased transparency would assist payers in comparing the discounts PBMs receive from drug manufacturers.

Real-Time Tools: The legislation also would require that, beginning in 2021, HHS implement real-time benefit tools that are capable of integrating with a prescribing healthcare professional’s electronic prescribing or electronic health record system for the transmission of formulary and benefit information in real time to prescribing healthcare professionals. These tools could not to be used to steer an individual to a particular pharmacy or pharmacy setting nor could they prohibit the designation of a preferred pharmacy. These tools should be capable of transmitting information specific to an individual enrolled in a Medicare Part D drug plan and should include:

  • a list of any clinically appropriate alternatives to a drug included in a plan’s formulary;
  • cost-sharing information for a drug and its alternatives, including a description of any variance in cost sharing based on the pharmacy dispensing a drug or its alternatives; and
  • information relating to whether the drug is included in the formulary of a plan or any prior authorization or other utilization management requirements applicable to a drug or its alternatives.

The legislation was introduced by U.S. Rep. Abigail Spanberger (D-Va.) with U.S. Reps. Jodey Arrington (R-Texas) and Brendan Boyle (D-Pa.) and was cosponsored by U.S. Reps. Jeff Van Drew (D-N.J.), Elissa Slotkin, (D-Mich.) and Van Taylor (R-Texas).

Access to Data by Congressional Advisory Panels

Legislation authored by U.S. Rep. Buddy Carter (R-Ga.) passed the House by voice vote also on Oct. 28. The Payment Commission Data Act of 2019, H.R. 1781, provides the Medicare Payment Advisory Committee (MedPAC) and the Medicaid and CHIP Payment and Access Commission with access to drug pricing and rebate data to assist Congress in better understanding how the drug market is operating.

The commissions provide recommendations to Congress annually concerning Medicare and Medicaid, respectively.

Analysis

Neither of the bills that passed is of the sweeping nature that H.R. 3 is. H.R. 3 would force negotiation of drug prices using an international reference.

However, the House legislation is similar to provisions in the Senate Finance Committee’s proposal that was reported out of that committee July 23, 2019. Senate leadership has not shown any support for drug price negotiations. The House could pass more provisions similar to what is in the Senate Finance Committee bill, making it more likely that sections of the Senate Finance Committee bill, or similarly drafted provisions, could be part of a year-end package.