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House, Senate craft separate health care packages

Several committees have bills addressing drug pricing middlemen, whom many members blame for high costs and access issues

Sen. Rand Paul, R-Ky., right, Chairman  Bernie Sanders, I-Vt., center, and ranking member Sen. Bill Cassidy, R-La., are seen during a Senate Health, Education, Labor and Pensions Committee hearing in March. Sanders and Cassidy this week announced a May 2 markup of a series of bills aimed at addressing drug prices.
Sen. Rand Paul, R-Ky., right, Chairman Bernie Sanders, I-Vt., center, and ranking member Sen. Bill Cassidy, R-La., are seen during a Senate Health, Education, Labor and Pensions Committee hearing in March. Sanders and Cassidy this week announced a May 2 markup of a series of bills aimed at addressing drug prices. (Tom Williams/ CQ Roll Call)

House lawmakers are kick-starting the legislative process for a number of health care bills at the same time their Senate counterparts are shaping their own package on drug pricing, and members appear to be finding common ground on pharmacy benefit managers.

Senate Majority Leader Charles E. Schumer, D-N.Y., is aiming to put a drug pricing package on the floor this year. While the parameters of the legislation are still fluid, several committees across the Capitol have approved or are on the verge of marking up bills addressing PBMs, the drug pricing middlemen many members blame for high costs and drug access issues.

The proposals all have a similar focus on transparency and are bipartisan, raising the odds that something could pass this Congress. But a potential vehicle and timeline is still unclear as the two chambers have not yet talked to each other, lawmakers say.

“I don’t know that these will all become one single bill, but I think there are a lot of policies we’re going to pursue, and we really hope to see a majority of this or all of it signed into law,” said Rep. Brett Guthrie, R-Ky., who chairs the House Energy and Commerce Health Subcommittee, which on Wednesday debated 17 health proposals, including three related to PBMs.

But lawmakers have not yet decided how to address unfinished business on insulin prices in the commercial insurance market. Democrats capped Medicare copays at $35 a month last year but were blocked from extending the cap to the commercial market under procedural rules.

It’s not clear if insulin legislation will make it into a final package. Senate action on insulin could skip the regular committee process after two bills were excluded from the Health, Education, Labor and Pensions Committee markup on four PBM bills next week.

HELP Chairman Bernie Sanders, I-Vt., would not say whether he supported either bill but said he would expect to see a “merger of a number of bills” on the floor.

Sen. Jeanne Shaheen, D-N.H., who is co-sponsoring one of the insulin bills with Sen. Susan Collins, R-Maine, said she was engaged in talks to bypass regular order.

“I think there’s a question about what is most helpful to move the legislation and how that’s done,” she said. “And that’s an ongoing conversation.”

PBMs

Energy and Commerce on Wednesday discussed a bipartisan bill sponsored by Rep. Earl L. “Buddy” Carter, R-Ga., that would ban “spread pricing” by pharmacy benefit managers in Medicaid, a practice that occurs when a PBM charges a health plan higher prices for drugs than what is paid to the pharmacy. The state of Ohio sued Centene over such a process before reaching a settlement in 2021.

Another bill sponsored by Rep. Ann McLane Kuster, D-N.H., would require PBMs to provide employers with data on drug spending, rebate information and the rationale for formulary placement. That bill is similar to one sponsored by Sanders scheduled for the Senate HELP markup next week. Sanders, however, said he was unaware of the House’s plans.

And a third Energy and Commerce discussion draft bill would create cost-sharing limits on “highly rebated” drugs.

“I think there’s a majority on both sides of the aisle for almost every policy,” Guthrie said, adding the committee hasn’t worked with the Senate yet but hopes that bipartisan action on the House would pressure the Senate to act.

The Pharmaceutical Care Management Association, which represents PBMs, is pushing back against the scrutiny. CEO JC Scott scolded lawmakers and reporters for focusing on “outlier situations” at the group’s annual policy forum Tuesday.

“While we should absolutely focus on ensuring fewer patients fall through the cracks when it comes to affordability and access, we can’t lose sight of the fact that our system is working for so many others,” he said. “Because if we do lose sight of that reality, we run the risk of advancing legislation and regulation that undermines the health care system instead of improving it.”

The Senate HELP package also includes three long-standing bipartisan measures, including one to strengthen oversight of the Food and Drug Administration’s citizen petition process, another to improve incentives for generic manufacturers and a third aimed at boosting competition for rare disease drugs.

The Senate Judiciary and Commerce committees also recently approved bipartisan legislation that would increase transparency of PBM business practices. And last week, Senate Finance Committee leaders unveiled a framework for their own bill.

Insulin

Additional action on insulin has stalled in recent months, but sponsors of both bills are working to break the logjam.

Shaheen and Collins recently revamped their bill that would extend Medicare’s $35 price cap to commercially insured patients, reduce insurance hurdles for insulin access, accelerate generic products and require that PBMs pass through any drugmaker rebates to health plans.

The previous iteration included incentives to discourage drugmakers and PBMs from negotiating rebates entirely, with the goal of reducing list prices that would benefit the uninsured as well as the insured. But the provision was dropped after the Congressional Budget Office estimated it would cost $23.3 billion over a decade.

Passing through rebates to health plans, by contrast, is expected to reduce spending. The three major insulin manufacturers have also all voluntarily slashed their list prices in recent months after a formulaic change increased rebates they would otherwise owe to Medicaid.

Both Shaheen and Collins pitched their bill on the Senate floor Tuesday, urging lawmakers to overhaul the complex drug pricing system.

“This is so convoluted — and lacks transparency — that no wonder we end up with a system that is rife with conflicts of interest,” Collins said. “One thing is clear, the way that the rebate functions in the current market is a key factor not of lowering the cost to the consumer, but of driving up insulin costs.”

The second insulin bill from Sens. Raphael Warnock, D-Ga., and John Kennedy, R-La., would cap copays for insured and uninsured individuals at $35 and require the Department of Health and Human Services to reimburse doctors and pharmacies for the cost of providing insulin to the uninsured.

Neither Sanders nor HELP ranking member Bill Cassidy, R-La., would say whether they support either of the two measures.

“It’s not just the price of it, it’s the price that comes to the patient,” Cassidy said. “And that takes a little bit more forethought. And I think that’s what we’re trying to get at with the PBM bill.”

The CEOs of the big three insulin manufacturers — Eli Lilly, Novo Nordisk and Sanofi — are expected to testify to the committee May 10, along with top executives from major pharmacy benefit managers CVS Health, Express Scripts and OptumRX.

“We’re going to do everything we can not only to make sure that insulin is going to be affordable to all, but we’re going to lower the price of prescription drugs,” Sanders said. “It is long overdue.”

Ariel Cohen contributed.