Tester, Capito, Brown, Lankford Introduce Bill to Lower Drug Costs, Hold Massive PBM Corporations Accountable

Senators’ Protect Patient Access to Pharmacies Act brings accountability to PBMs, protect patients and small businesses

In an effort to lower drug costs and support small businesses, U.S. Senators Jon Tester, Shelley Moore Capito (R-W.V.) Sherrod Brown (D-OH), and James Lankford (R-OK) today introduced legislation to hold Pharmacy Benefit Managers (PBMs) accountable.

The Pharmacy DIR Reform to Reduce Senior Drug Costs Act will ensure that all pharmacy price concessions are assessed at the point of sale and eliminate the retroactive nature of direct and indirect remuneration (DIR) clawback fees imposed by PBMs. The Centers for Medicare and Medicaid Services (CMS) estimates this change will save Medicare beneficiaries an estimated $7.1 to $9.2 billion in reduced cost sharing. 

“For most Montanans, rural pharmacies are the only option when it comes to getting life-saving prescriptions medications, but too many pharmacies are going out of business because they’re getting slammed with hidden fees,” said Tester. “Rural America can’t survive without these vital operations, which I why I’m working with my colleagues to hold corporate middle men accountable and put an end to the hidden clawback fees that are squeezing pharmacies and their customers.” 

“Pharmacists, including those in our small towns and rural areas, play a vital role in keeping our communities healthy,” said Capito. “I’m proud to join my colleagues in introducing the Protect Patient Access to Pharmacies Act, which will help ensure pharmacies remain open and our Medicare patients will continue to have access to the medications and information they need from those they trust.”

“With the Inflation Reduction Act we finally fought back against Big Pharma to start to bring down the price of prescription drugs,” said Brown. “Our bipartisan bill builds on that progress by holding corporate middlemen accountable, lowering costs at the pharmacy counter, and empowering Ohio pharmacists to better serve their communities.”

“Small, independent pharmacies work hard to provide rural areas and local neighborhoods in Oklahoma with access to the medications and pharmacy services they need, and the messy prescription drug pricing system in our nation seems to hit them at every turn,” said Lankford. “Pharmacy benefit managers—the drug-price middlemen—make serving people in need harder by giving unclear instructions and pricing information to local pharmacies, which makes drug pricing more complicated and more expensive. This has to stop. We need to unravel prescription drug costs and openly address all the rebates and kickbacks that drive up the cost of health care and that decrease access to care in our nation, particularly for senior adults.”

“Supermarket pharmacies play an essential role in serving their communities, but the combination of predatory PBM practices like retroactive DIR fees and egregiously low reimbursement rates is unsustainable – particularly for the supermarket industry that operates on razor thin profit margins, generally about 2%,” said Leslie Sarasin, President and Chief Executive Officer of FMI – The Food Industry Association. “This bipartisan, commonsense legislation would reduce patient out-of-pocket costs and prohibit the continuation of the levying of DIR fees while providing increased transparency and requiring fair pharmacy reimbursement. We thank the bill sponsors for their leadership and look forward to working with them and Congressional leadership to secure passage in the 118th Congress.”

“The National Association of Specialty Pharmacy (NASP) is grateful for the introduction of the bipartisan Pharmacy DIR Reform to Reduce Senior Drug Costs Act and the leadership of Senators Tester, Moore Capito, Lankford, and Brown,” said President and CEO Sheila Arquette, RPh – National Association of Specialty Pharmacies. “Congress must put an end to anti-competitive practices that are intended to limit specialty pharmacies from being included in plan networks,” said NASP President and CEO Sheila Arquette, RPh.  “The truth is pharmacy DIR claw backs and other deceptive fees on pharmacies are tactics that ultimately eliminate patient access and choice. This bill will strengthen and enforce existing law and ensure specialty pharmacies can continue to care for patients that have complex and costly medical conditions.”

“Ending DIR fee abuses is essential for patients’ pharmacy access, for lower drug prices, and to prevent the baffling expectation that pharmacies fill prescriptions at a loss while PBMs manipulate the Part D program to boost their profits at the expense of seniors,” said Steven C. Anderson, president and CEO National Association of Chain Drug Stores. “NACDS represents regional pharmacies with as few as four stores as well as national pharmacies – and we emphasize that DIR fee reform is essential for comprehensive PBM reform that matters to all patients and to the diverse pharmacies that serve them.”

“Independent pharmacies have struggled for years with PBM pressures, with pharmacy DIR fees being a top concern. NCPA is grateful to Sens. Tester, Capito, Brown, and Lankford for introducing this legislation to provide relief,” said Anne Cassity, Senior Vice President of Government Affairs at the National Community Pharmacists Association. “We urge Congress to swiftly finalize comprehensive PBM reforms that include this important bill.”

In recent years, PBMs have increasingly returned to pharmacies days or even weeks after the point-of-sale to demand more in DIR fees. From 2010 to 2019, CMS documented a 91,500 percent increase in DIR fees paid by pharmacies.

The Protect Patient Access to Pharmacies Act will increase transparency and hold PBMs accountable by:

• Enforcing and strengthening the federal “any willing pharmacy” law to ensure pharmacies are no longer subject to practices that ultimately limit network participation and steer patients away from pharmacies. 
• Standardizing and overseeing the metrics PBMs and plans use to measure pharmacy performance and quality and ensuring they are fairly applied.
• Ensuring transparency in payments and fees issued by PBMs.