Washington, D.C. – U.S. Senators Catherine Cortez Masto (D-Nev.), Thom Tillis (R-N.C.), Ron Wyden (D-Ore.) and Mike Crapo (R-Idaho) introduced bipartisan legislation to ensure seniors with Medicare get the best possible deal on their prescription drug coverage. The Medicare PBM Accountability Act would require pharmacy benefit managers (PBMs) to disclose behind-the-scenes practices that drive up prices and costs and would empower Medicare to negotiate lower prices for the nearly 50 million Americans enrolled in Medicare Part D drug plans.
While pharmaceutical manufacturers set a drug’s list price, studies have found that rebates and discounts paid to PBMs play a role in driving price increases. With six PBMs now controlling 95% of the private market, it is critical for health plans to have a line of sight into negotiations between PBMs and drug companies to ensure they are getting the best deal for beneficiaries.
“Massive companies shouldn’t be able to raise prescription drug prices on our seniors and then skim off the top,” said Senator Catherine Cortez Masto. “Congress must require these companies to disclose their clear conflicts of interest, and I look forward to working on this bipartisan legislation to help us bring down health care costs for seniors in Nevada and across the country.”
“I’ve consistently supported efforts to increase transparency across all aspects of the pharmaceutical supply chain – from manufacturers to the pharmacy counter,” said Senator Thom Tillis. “The opaqueness of the supply chain has resulted in artificially high prescription drug prices at the expense of seniors and taxpayers, and I’m proud to work on a bipartisan basis to expand access to affordable prescription drugs by increasing transparency, accountability, and competition.”
“Drug pricing middlemen like PBMs use secret tactics to keep prices high while keeping patients and taxpayers in the dark,” said Senate Finance Committee Chairman Ron Wyden. “This proposal will shine a bright light on PBM practices that are fostering anticompetitive practices and conflicts of interest. I thank Senators Cortez Masto and Tillis for working with Ranking Member Crapo and I on this important effort, and I look forward to including it in the committee’s work moving forward.”
“Medicare Part D can drive greater savings for seniors at the pharmacy counter with more transparency at every level of the prescription drug supply chain,” said Senate Finance Committee Ranking Member Mike Crapo. “This proposal would empower Part D plans of all sizes through a more competitive and accountable pharmacy benefit manager marketplace, driving better and more affordable options for Americans, including broader access to low-cost biosimilars and generics.”
While government health plans, employers, and other payers work with PBMs to negotiate prescription drug price discounts with drug manufacturers and create pharmacy networks, PBMs are getting paid by these same companies, creating clear conflicts of interest and opportunities for potential anticompetitive behavior. The Medicare PBM Accountability Act would establish new requirements for PBMs to submit annual reports to Medicare drug plans disclosing price negotiations and rebate information that impact what seniors pay in premiums and co-pays. Enhanced transparency around how PBMs are delivering and paying for prescription drugs will help Medicare drug plans select PBM services that best serve the needs of beneficiaries, lowering costs for seniors and taxpayers.
Senator Cortez Masto has been a champion of affordable, quality health care, including mental and behavioral care. Cortez Masto recently introduced the Lower Drug Costs for Families Act to hold Big Pharma accountable and penalize drug companies for raising prescription drug prices faster than the rate of inflation. She passed legislation to allow Medicare to negotiate lower drug prices and cap the cost of insulin at $35-a-month for Medicare recipients through the Inflation Reduction Act.
###