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CAPD Statement on Proposed Rule to Eliminate Safe Harbor Protections for Rebates

Debra Barrett, Executive Director of the Coalition for Affordable Prescription Drugs (CAPD), issued the following statement in response to the proposed rule released by HHS and the HHS OIG:

“CAPD is reviewing the proposed rule and will continue to urge policymakers to preserve and enhance the ability of PBMs to deliver savings at the pharmacy counter and keep patients’ premiums stable.

Eliminating rebates in their current form does nothing to address the root cause: the high and rising prices set by drug companies. For instance, in Medicare Part D alone, eliminating rebates could increase premiums by as much as 52 percent, and drug companies would need to voluntarily lower their prices by 45 percent to hold seniors harmless from the resulting premium hikes.

Any proposal that aims to lower drug prices should actually do just that. As we laid out in our policy framework, we will use the following five questions to guide our review and comments on today’s rule, and any proposed solutions by the Administration or Congress, aimed at reducing drug prices:

  1. Does it raise or lower the price of a drug set by drug companies?
  2. Does it increase or decrease premiums and out of pocket costs for patients?
  3. Does it increase or decrease the net cost of drugs for employers and other purchasers?
  4. Does it raise or lower costs for federal and state governments and taxpayers?
  5. Does it provide a one-time price reset or does it increase competition and create sustainable downward pressure on the price of drugs over time?

As we seek to address the high price of prescription drugs, we must remember that the stakes are high for patients and stakeholders across the system. Policymakers should not risk increasing premiums for seniors and undermining the Part D Program, nor should they remove one of the only defenses in the commercial market against pharma’s out-of-control price hikes.

We need solutions that get to the root cause of high drug prices, and find ways to build on the proven, private sector tools that have increased access to prescription drugs for 266 million Americans.

About CAPD

The Coalition for Affordable Prescription Drugs (CAPD) is a diverse group of employers, unions, public sector employees and retirees who partner with pharmacy benefit managers (PBMs) to provide more affordable prescription drug coverage for millions of Americans. For more information, visit http://www.affordableprescriptiondrugs.org/.