Tester, Daines Fight for Transparency in Drug Pricing

Senators Call for Lower Drug Prices for Seniors

(U.S. Senate) – U.S. Senators Jon Tester and Steve Daines are pushing the Centers for Medicare and Medicaid Services (CMS) to increase transparency and accuracy of prescription drug costs for Montana seniors.

In a letter to CMS Administrator Seema Verma, the Senators raised concerns with current CMS policies that allow Pharmacy Benefit Managers (PBMs) to impose retroactive fees that threaten rural pharmacies and take money out of the pockets of Montana’s seniors.

“We have heard from numerous pharmacies in our communities – many of which are rural or medically underserved – that these fees cause so much uncertainty that they do not know if they can continue to serve American families,” wrote Tester and Daines. “This sort of opacity in the real cost of prescription drugs is exactly why Americans are so frustrated.”

Tester and Daines are urging Verma to adopt a proposal that will stop PBMs from imposing these retroactive fees and instead create certainty with drug prices by including price changes in the cost of the drug when it is sold. Currently, PBMs are allowed to come back to pharmacies well after a drug is sold and pay less for it than was originally expected. Seniors are left paying more out of their own pockets because the real price of their drugs ends up being different the price they paid. CMS estimates that the proposal will save Medicare beneficiaries over $10 billion dollars in lower cost-sharing for their prescription drugs.

“Seniors should no longer have to bear the burden of artificially inflated drug prices when they go to the pharmacy counter,” the Senators continued. “This proposal will help reduce the financial strain on seniors with fixed incomes.”

PBMs often use retroactive fees called Direct and Indirect Remuneration that are assessed as much as six months after seniors fill their prescriptions. These fees are typically difficult for pharmacies to estimate and can create losses in revenue that burden small and rural pharmacies. Tester introduced legislation – the Improving Transparency and Accuracy in Medicare Part D Drug Spending Act – to prevent PBMs from assessing these retroactive fees on accurate claims submitted by pharmacies.

“Thanks to the strong leadership of Senators Capito (R-W.Va.), Tester and Daines, a bipartisan coalition of senators has endorsed CMS’ fix for the problem of retroactive pharmacy DIR fees,” said National Community Pharmacists Association CEO B. Douglas Hoey, Pharmacist, MBA. “Patients, taxpayers, and pharmacies will all benefit from the agency’s transparent, common-sense proposal.”

You can read the full text of Tester and Daines’ letter HERE.