OPM: Don’t restrict our pharmacy contracts

Andrew Van Dam

About Andrew Van Dam

Andrew Van Dam of The Wall Street Journal previously worked at the AHCJ offices while earning his master’s degree at the Missouri School of Journalism.

“Nearly 30 percent of the government’s $39 billion health plan goes to cover prescription drugs,” writes Stephen Losey of Federal Times, a publication directed at federal managers. Perhaps that’s why there has been such a strong reaction to the “Prescription Drug Integrity, Transparency and Cost Savings Act” (H.R. 4489), especially from the federal Office of Personnel Management.

medsPhoto by jypsygen via Flickr.

(The bill), sponsored by Rep. Stephen Lynch, D-Mass., would require PBMs [pharmacy benefit managers] to return to the government 99 percent of all rebates, market share incentives and other savings they receive. It would place new transparency requirements on PBMs and cap drug prices to make sure the government doesn’t pay more than the nationwide average. PBMs would also be prevented from switching federal employees’ drugs to cheaper alternatives without their physicians’ prior approval.

The bill would restrict how the government contracts with pharmacy benefit managers because, Losey writes, “critics say PBMs have opaque pricing methods, retain most discounts or rebates prescription drug manufacturers give them, and receive little oversight from OPM.”

A subcommittee hearing on the bill was held Tuesday.

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