ACP issues policy recommendations to cut rising costs of prescription drugs

ACP called for changes to address the rising cost of prescription drugs in two position papers that provide recommendations to improve transparency in industry and government, examine the role of the pharmacy benefit manager (PBM), and address barriers to drug access under Medicare and Medicaid.

The position papers expand on one that ACP issued in 2016, and offer additional recommendations to decrease out-of-pocket costs for patients, enhance the government's purchasing power, and address existing policies that add costs to the health care system.

In the first paper, addressing public health programs, ACP supports:

• changes to the Medicare Part D low-income subsidy program cost-sharing and copayment structures to encourage the use of lower-cost generic or biosimilar drugs,
• annual out-of-pocket spending caps for Medicare Part D beneficiaries,
• adoption of Medicare Part D negotiation models that would drive down the price of prescription drugs for beneficiaries,
• efforts to minimize the financial impact on the federal government of prescription drug misclassification in the Medicaid Drug Rebate Program, and
• further study of payment models in federal health care programs, including methods to align payment for prescription drugs administered in-office in a way that would reduce incentives to prescribe higher-priced drugs when lower-cost and similarly effective drugs are available.

A second position paper offered recommendations to improve information about drug pricing for physicians and patients.

ACP supports:

• improved transparency, standards, and regulation of PBMs, including a ban on “gag clauses,”
• availability of accurate, understandable, and actionable information on the price of prescription medication, and
• public reporting by health plans, PBMs, and pharmaceutical manufacturers about the amount paid for prescription drugs, aggregate rebates, and nonproprietary pricing information.

“The ACP believes increased transparency is needed on the part of PBMs and health plans to provide greater understanding of drug prices, help patients make informed decisions, and support a more sustainable health care system,” the authors wrote.

An editorial stated that eliminating cost-sharing for generic drugs could increase medication adherence and may decrease subsequent health care use and spending in the Medicare program. While a cap on out-of-pocket spending will improve financial protection for beneficiaries with high drug spending, it could also increase premiums to accommodate lower spending and beneficiaries who reach the cap could become less price-sensitive, the editorialists wrote. Regarding drug price negotiation, the editorialists said repealing the noninterference clause may not be sufficient and suggested continued exploration of other negotiation strategies. The editorialists praised ACP's support of payment strategies that reduce incentives to prescribe higher-priced drugs.

“Many of the ACP's policy recommendations are currently being debated among members of Congress. Clear support from physician groups on reforms that focus on drug pricing, out-of-pocket spending, and access are encouraging,” the editorialists wrote. “Although tradeoffs will need to be considered before selection or implementation of policy solutions, policymakers must act to ensure that patients have access to the prescription drugs they need at a price that reflects the benefits to patients and society.”