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January Legislative Update: Reform Proposals on DIR Fees

Antonio Ciaccia, Director of Government & Public Affairs; and Michelle Fitzgibbon, Lobbyist

U.S. Senate adopts Ohio-backed reform proposals on DIR fees!

OPA joins a large coalition of national pharmacy groups in applauding the latest version of the bipartisan Prescription Drug Pricing Reduction Act, released by the Senate Finance Committee, which addresses back door clawback fees charged by large pharmacy benefit managers (PBMs) that are shuttering pharmacies and costing patients more at the pharmacy counter.

“This legislation represents a potentially major reform that would generate savings and create pricing transparency for pharmacy patients,” said the group. “It would put a stop to the predatory practice of imposing fees on pharmacies long after the point of sale and charging patients more up front for their drugs.”

The coalition represents: the National Community Pharmacists Association (NCPA), National Association of Chain Drug Stores (NACDS), American Society of Consultant Pharmacists (ASCP), National Association of Specialty Pharmacists (NASP), Food Marketing Institute (FMI), National Grocers Association (NGA), American Pharmacists Association (APhA), and the National Alliance of State Pharmacy Associations (NASPA).

The updated draft legislation (S. 2543) released in December would require all pharmacy price concessions and DIR fees to be included in the negotiated price at point of sale for Medicare Part D starting January 1, 2022. It would prohibit plans and PBMs from retroactive recoupment. Additionally, the bill would move up the implementation of standardized pharmacy quality measures to 2022.

A previous version of the bill did not address DIR clawbacks, a shortcoming that pharmacy groups warned would be a missed opportunity. Ohio’s Senators Rob Portman and Sherrod Brown have been huge driving forces in these reforms, and OPA applauds their work on the bill.

  1. 2543 also includes other crucial PBM reforms, including ending spread pricing in Medicaid programs, requiring Medicaid reimbursement parity with fee-for-service programs, and to begin collecting pricing data on specialty drugs.

OPA urges members to contact their federal officials to urge passage of S. 2543.

Medicaid PBM Saga Continues

OPA is working with state officials to ensure proper disbursement of the $100 million in supplemental dispensing fees that we secured in the budget in mid-2019. We hope to hear of a plan from the Department of Medicaid soon.

OPA continues to advocate for a “cost-plus” reimbursement structure that bases prices on actual drug costs, rather than PBM whims or artificially-inflated, meaningless benchmarks like Average Wholesale Price (AWP). Members are again encouraged to continue to ask their lawmakers to end the PBM shell game, and to take back control of a system that continues to be abused at the expense of patient access.       

Pharmacy PAC

Please consider financial support of our legislative efforts by contributing to the OPA Pharmacy PAC. 100 percent of PAC donations go to help candidates who support pharmacy in Ohio. By donating to the PAC, you support OPA legislative goals and objectives, which reflect the goals and objectives of our members. Visit http://bit.ly/OPA_PAC to make a donation!

For more information, contact Antonio Ciaccia at aciaccia@ohiopharmacists.org or 614.389.3236.

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