If the two measures announced Friday survive legal challenges, they will radically transform the nation’s drug cost system. One will have Medicare pay the same cost for certain expensive prescription drugs as various other developed nations, a “most-favored-nation cost.”
The various other will effectively ban drug makers by providing rebates to pharmacy benefit managers in addition to also insurers — a radical change inside the way many drugs are priced in addition to also paid for in Medicare in addition to also Medicaid. Instead, drug companies will be encouraged to pass the discounts directly to patients at the pharmacy counter.
During a 22-minute press conference, Trump ran through a laundry list of drug cost efforts his administration undertook in his four years in office. Many, however, remain inside the proposal stage, were stopped by courts or had little impact. Prices have continued to rise, though the pace has slowed under his presidency.
He also alluded to the fact in which he may not be in office next year. “I just expect they keep the item. I expect they possess the courage to keep because the powerful drug lobby, Big Pharma, can be putting pressure on people like you would certainly not believe,” Trump said, referencing one of the rules.
Basing Medicare reimbursement on drug prices in various other countries
The rules stem by a series of executive orders Trump released in July in addition to also September.
Though Trump has slammed socialist health care systems in which exist in various other countries in addition to also attacked his Democratic rivals for seeking to implement such a setup here, he has celebrated linking US prices to peer nations’ lower costs.
The product, which will operate for seven years, will test paying the most-favored-nation cost for 50 Medicare Part B drugs in which are administered in doctors’ offices. These medications account for about 73% of Part B drug spending. This kind of will replace the current system, which pays the average sales cost plus a 6% add on.
The rule, which takes effect at the start of 2021, could save patients $28 billion.
The President’s executive order in July expanded the initiative to include certain Part D drugs sold at pharmacies, however Friday’s rule only referenced Part B medications. The Part D product can be under development, said Seema Verma, administrator of the Centers for Medicare in addition to also Medicaid Services.
Trump first outlined an International Pricing Index proposal to set Medicare reimbursement levels for certain drugs on their cost in various other countries in October 2018, seeking to bolster Republicans’ standing on health care days before the midterm election. the item called for the “target cost” to be 126% of the average of what various other countries pay.
Directing rebates to consumers
The second rule will effectively ban drug makers by providing rebates to pharmacy benefit managers in addition to also insurers — a radical change inside the way many drugs are priced in addition to also paid for in Medicare in addition to also Medicaid. Instead, drug companies will be encouraged to pass the discounts directly to patients at the pharmacy counter.
On Friday, HHS said in which patients may be able to save nearly 30%. the item will affect patients whose out-of-pocket costs are tied to a drug’s list cost — for instance, those who must meet a deductible, use a drug not covered by their insurance or pay co-insurance in which can be tied to the list cost. Those with high medication costs will benefit the most.
Experts took issue with This kind of claim.
the item will take effect at the start of 2022.
Immediate opposition by industry
Pharmaceutical industry groups immediately criticized the rules, promising to consider all options to stop the measures.
PhRMA, the drug makers’ lobbying group, said in which the most-favored-nation rule will threaten medical innovation inside the US in addition to also harm patients.
“the item defies logic in which the administration can be blindly proceeding using a ‘most favored nation’ policy in which gives foreign governments the upper hand in deciding the value of medicines inside the United States,” said PhRMA CEO Stephen J. Ubl. “History proves in which when governments take unilateral action to set prices, the item disrupts patient access to treatments, discourages investment in fresh medicines in addition to also threatens jobs in addition to also economic growth.
Industry organizations representing insurers in addition to also pharmacy benefit managers slammed the rebate rule.
“Simply put, the [Health in addition to also Human Services] Secretary’s decision to advance the previously withdrawn rebate rule will drastically increase Medicare Part D beneficiary premiums in addition to also taxpayer costs,” said JC Scott, CEO of the Pharmaceutical Care Management Association, which represents pharmacy benefit managers. “PCMA will explore all possible litigation options to stop the rule by taking effect in addition to also destabilizing the Medicare Part D program in which millions of beneficiaries rely on.”
House Democratic leaders, who have put forth their own plan to reduce drug prices, lashed out at Trump.
“While the coronavirus surges across the country, President Trump can be spending his twilight days in office pushing through half-baked proposals in which will likely be struck down in court because he’s desperate to cover up his administration’s failure to actually lower drug prices,” said Energy in addition to also Commerce Committee Chairman Frank Pallone, Jr. of fresh Jersey in addition to also Ways in addition to also Means Committee Chairman Richard E. Neal of Massachusetts.