While negotiations between biopharma and Medicare Part D health plans often lead to sizable rebates, not much of those savings are passed on to the consumer.
There has also been some concern raised amid recent efforts by the Trump Administration to address the drug pricing negotiations, including whether point-of-sale rebates would violate Part D’s non-interference clause, according to a PhRMA report.
The non-interference clause is home to two stipulations which have been key in its success:
- The Health and Human Services secretary “may not interfere with the negotiation between drug manufacturers and pharmacies and (Part D) plans;” and
- The secretary “may not require a particular formulary or institute a price structure for the reimbursement of covered Part D drugs.”
“The Medicare statute requires that the metric used to determine the price that seniors ultimately pay for their medicines must take into account negotiated price concessions such as rebates,” the PhRMA report states. “CMS’ proposal is a more than reasaonable interpretation of that requirement.”