PBM Reform Pulled Back in Late Change to Spending Package
With pressure from the House GOP, expected PBM reform was not included in Congress’ end-of-year spending package.
With reform advocates confident in Congress reining in pharmacy benefit managers (PBMs) in its end-of-year spending package, House Republicans stepped in to pull back on PBM reform and overall health care spending, according to The Hill.1
“The health care package that we and many of you lobbied members of Congress on this week crashed and burned last night,” said the National Community Pharmacists Association (NCPA) in a statement.2
READ MORE: Long-Awaited PBM Reform Included in Congress’ End-of-Year Spending Package
Prior to the GOP’s spending pull back, PBM reform was an expected prospect in next year’s package. | image credit: apichat / stock.adobe.com
Indeed, prior to the GOP’s spending pull back, PBM reform was an expected prospect in next year’s package. Some of the reform included provisions that would prohibit a slew of common PBM practices, including spread pricing, unfair contracting, patient steering, and more.3
“The PBMs systematically reimburse pharmacies less than their cost to buy and dispense medicine. That guarantees huge financial losses and has led to thousands of pharmacy closures and a loss of access for patients,” said NCPA CEO B. Douglas Hoey regarding the inclusion of PBM reform in the spending package.4 “The provisions in this legislation will help ensure that pharmacies are reimbursed more fairly, and that their contracts with PBMs aren’t the completely one-sided, take-it-or-leave-it contracts currently offered by the PBMs and their big insurance plan owners.”
However, with pressure from President-elect Donald Trump and incoming Department of Government Efficiency leaders Elon Musk and Vivek Ramaswamy, the bill did not include PBM reform. Instead, policymakers decided to go for a more “stripped-down” legislation designed mainly to avoid a future government shutdown.1-2
Aside from expelling PBM reform from the bill, these recent changes will also mean pull backs on spending for the SUPPORT Act designed for combating opioid and substance use disorder, as well as the Pandemic and All Hazards Preparedness Act. Furthermore, the bill excluded a previously expected payment boost for Medicare physicians and a hospital billing transparency provision. And finally, the bill will now extend Medicare telehealth and community health center funding until March 2025, rather than the previously expected 2 years.1
“A [continuing resolution] that includes health provisions but excludes bipartisan PBM reform is an embarrassing capitulation to the health insurance lobby,” wrote Representative Jake Auchincloss (D, Massachusetts) on X.2 “GOP leadership just backed down from the fight to lower Rx drug costs.”
Recent narratives surrounding PBM reform have been noticeably bipartisan. “The horrible middleman that makes more money, frankly, than the drug companies, and they don’t do anything except they’re a middleman,” said Trump earlier this week. From Federal Trade Commission reports to multiple congressional hearings with the largest PBMs in the industry, 2024 was one of the most eventful years involving the scrutiny of these middlemen.
But ultimately, in almost a complete change of course, these sentiments and promises were not executed upon. As government reform continues to be punted and the reining in of PBMs does not have a clear path forward, drug prices will continue at their increased trends and pharmacies around the country will face a continuation of unsustainable reimbursements from their PBMs.
However, for those fighting for PBM reform, there is still hope for the signing of previously introduced legislation such as the Better Mental Health Care, Lower-Cost Drugs, and Extenders Act of 2023 (S.3430); Modernizing and Ensuring PBM Accountability Act (S.2973); and Pharmacy Benefit Manager Transparency Act of 2023 (S.127).
With hopes of holding onto any bipartisan support that still exists, policymakers can still rely on a Republican-led Congress to pass PBM legislation in the upcoming term. But as those hopes have been crippled by recent pull backs, yet another significant obstacle for PBM reform has been introduced.
“In the last 2 years, NCPA and our members and partners built a strong bipartisan majority in Congress in favor of these reforms, and we are grateful to all our champions on Capitol Hill for getting us to this point. Now it’s critical that Congress finishes the job and passes the continuing resolution,” concluded Hoey.4
Stay tuned for our ongoing PBM reform coverage as Congressional lawmakers begin to announce their plans for 2025 and beyond.
READ MORE: Patients Before Monopolies Act to End Conflicts of Interest Between Pharmacies, PBMs
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