News & Views: 8/31 - 9/6

September 7, 2021

The Senate bill intended to lower drug prices through negotiation may only apply to the Medicare program.

Senate leadership in charge of drafting the bill have previously stated that they support extending Medicare negotiation savings to the commercial market, but now the measure is a concern due to the minimal impact that would have on the federal budget.  Employer groups, including the ERISA Industry Committee, have repeatedly said they will oppose Medicare negotiation if it does not apply to the commercial market as well. Employers and drug pricing experts have warned Congress that if the measures do not protect the private market, drug manufacturers will increase prices even more to recoup profits lost in the Medicare program. To read the full article, click here.

The infrastructure bill that passed in the Senate (8/10) will require drug manufacturers to pay large fines for late refunds of any unused drugs.

This policy will require drug companies to refund Medicare for unused drugs in Part B. However, manufacturers who do not comply will face a 25% late penalty on top of the refund. CBO previously scored that this policy would save $3 billion over a decade. The infrastructure bill is set to be voted on by the House in late September. To read the full article, click here.

The Medicare Trust Fund Report projected decreased spending in Part D due to drug rebates.

The report projected higher than expected rebates and increased Medicare Advantage enrollment to cause a slight decrease in Part D expenditures from the previous year. However, specialty drug costs will still increase spending more than generic drug competition can save. The report also projected that Part D drug costs will increase 6.1% over the next five years. To read the full article on the Part D projections in the report, click here.

  • To read the full report click here.

Healthcare groups continue to urge Congressional leadership to pass aggressive drug pricing reforms in the reconciliation package.

The letter, signed on to by 31 healthcare advocacy groups, urged House and Senate committee chairs to pass Medicare negotiation for all Americans and create price hike protections to lower costs for patients and generate savings for other crucial healthcare reforms. They note that not passing bold, impactful reform would leave many of their Democratic pledges to their constituents unfulfilled. To read the letter, click here.

CIDSA Experts in the News

Sean Dickson authored a STAT First Opinion that proposed a new rebate model that benefits the beneficiary and not drug companies. As Congress moves forward to fully repeal the Trump-era rebate rule, Dickson proposed that savings from rebates are passed down to beneficiaries to lower their cost-sharing. This model could save beneficiaries $29 billion on their prescription drugs between 2022-2029.  To read the full op-ed, click here.

Rachel Sachs coauthored a Brookings Institute article that proposes a new framework to categorize and analyze prescription drug reform policy proposals. The framework includes three categories of policies: (1) those focusing on patients’ out-of-pocket costs; (2) those targeting problematic incentives for various stakeholders within the system; and (3) those addressing the high prices of particular drugs. Sachs and her colleagues warn that policymakers must implement policies from each category, as choosing policies solely from one will just exacerbate the problem in the other two areas. To read more, click here.

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