Congress’ and HHS’ Health Care Policy Priorities: Lowering Drug Costs

Friday, February 8, 2019

By: Eric Gascho, Vice President of Policy and Government Affairs

Both the Senate Finance Committee and the House Committee on Oversight and Reform focused their first hearings of the 116th Congressional Calendar on the rising cost of prescription drugs. 

The Senate Finance Committee’s hearing topic was bipartisan policy solutions for lowering drug costs.

“As I’ve stated time and again, addressing the sky-high cost of prescription drugs is a priority for me and the Senate Finance Committee this Congress. We already know what the problem is. It’s time to look at bipartisan solutions and work to turn them into law,” said Senate Finance Committee Chairman Chuck Grassley (R-IA).

The hearing is the first in a series and is part of Capitol Hill’s larger overhaul of current drug-pricing practices. On Feb. 26, seven pharmaceutical executives will testify before the Committee. The seven companies were invited by Grassley earlier this week.

Grassley recently co-sponsored a bill with U.S Senator Amy Klobuchar to curtail anti-competitive agreements in which brand companies pay generic companies to not introduce generics drugs onto the market. These deals, which delay consumer access to generic and biosimilar drugs, artificially inflate drug prices. The bipartisan Preserve Access to Affordable Generics and Biosimilars Act would curb such practices and close the loopholes that restrict market competition.

The House Committee on Oversight and Reform’s first hearing is part of the Committee’s larger investigation into the prescription drug industry’s pricing practices. Earlier this month, they sent letters to a dozen of the country’s largest pharmaceutical companies asking for 10 years of pricing information on the companies’ popular medicines. The Committee is also seeking information on these companies’ interactions with governmental agencies like the Food and Drug Administration and the Centers for Medicare & Medicaid.

The Trump Administration is focused on lowering drug prices as well. Last Thursday, the Department of Health and Human Services released a proposed rule that would ban drug rebates, unless they’re shared directly with seniors at the pharmacy counter. According to HHS, the proposal would lower prescription drug prices and out-of-pocket costs by encouraging manufacturers to pass discounts directly on to patients at the point of sale.

In a statement, NHC’s CEO Marc Boutin, JD, said, “the proposal appears to be a great step toward putting patients first by increasing system transparency and reducing the cost of drugs for our nation’s seniors. While we are still analyzing the proposed rule, sharing drug rebates with patients is a policy concept we have long supported, as rebates can contribute to higher costs.” The NHC will dig deep into the proposed rule to determine what the impact will be on patients’ out-of-pocket-costs and will submit comments.

Some other efforts by the administration to lower drug costs include:

  • A proposed rule on “Modernizing Part D and Medicare Advantage to Lower Drug Prices and Reduce Out of Pocket Expenses”
  • The CMS Advance Notice of Proposed Rulemaking entitled “International Price Index Model for Medicare Part B Drugs” 

Read more about our comments on these proposals in a blog post from last week.

The NHC is committed to working with Congress and the administration to craft common-sense solutions that reduce patients’ health care costs by promoting high-value care, stimulating research and competition, and curbing costs responsibly. We do not support policies that achieve savings if they negatively impact patient safety, or access to care. Read more about our Health Care Costs Initiative here.