WASHINGTON – Sen.
Chuck Grassley (R-Iowa) and a bipartisan group of 29 lawmakers are
urging
the Centers for Medicare & Medicaid Services (CMS) to help lower the cost
of prescription drugs for Part D beneficiaries through certain pharmacy direct
and indirect remuneration (DIR) fee reforms issued in a proposed regulation. In
a separate
letter,
Grassley also reiterated his commitment to lower prescription drug costs by
passing the
Prescription Drug Pricing
Reduction Act (PDPRA).
“Pharmacy DIR
fees have grown more than 107,400% between 2010 and 2020,” Grassley said in his letter to CMS. “This has caused increased
costs for seniors at the pharmacy counter. By ending DIR fee clawbacks, the
proposed rule would reduce seniors’ net out-of-pocket prescription drug costs
by $21.3 billion over 10 years. The unsustainable growth in DIR fee clawbacks
has also hurt pharmacists, especially those operating independently in rural
Iowa.”
Grassley continued, “I have
consistently supported policies to end DIR fee clawbacks and support this
proposed rule to reform DIR fees. By strengthening the proposed rule and
finalizing it without delay, this rule will lower patient costs, maintain
patient access to rural pharmacies, and provide pharmacists payment
predictability that is needed to run their businesses.”
You can read the
letter Grassley sent to CMS expressing his commitment to ending DIR fee
clawbacks – while also advocating for the bipartisan PDPRA, which will
comprehensively lower prescription drug costs – by clicking
HERE.
In a Senate Floor
speech, Grassley expressed the importance of protecting access to rural
pharmacies by ending DIR fee clawbacks and urged his colleagues to support this
effort. Grassley also reiterated his commitment to passing the bipartisan
PDPRA, which remains the best chance to lower prescription drug costs in a
bipartisan manner. You can view his remarks by clicking
HERE.
“The Iowa Pharmacy
Association appreciates Senator Grassley’s leadership and support in taking
action to end DIR fees. Representing over 2,500 members across the state, IPA
hears about the negative impact retroactive DIR fees have on pharmacists and
the patients they serve daily. Thank you to Senator Grassley,” said Kate Gainer, CEO of the Iowa Pharmacy
Association.
“The imposition
of increasing DIR fees continues to have a devastating impact on our patients
as well as our company. Our communities rely on us; however, the economic
impact of the current DIR landscape is becoming unmanageable. We greatly appreciate Senator Grassley’s
persistent efforts and advocacy on behalf of the industry and his constituents,”
said Kristin Williams, Executive Vice
President and Chief Health Officer, Hy-Vee, Inc.
“I would like to
thank Senator Grassley for signing onto the Senate DIR reform letter and for
all of his advocacy for Iowa pharmacy and consumers. This proposed action would
stop DIR fees from artificially raising prescription prices for consumers. In
addition, retroactive DIR fees make cash flow almost impossible for pharmacies
to manage. With DIR fees, the pharmacy does not know how much they will get
paid for prescriptions until months later which is what makes cash flow management
difficult to assess,” said Bill
Drilling, Pharmacist and Owner of Drilling Pharmacy in Sioux City.
“I would like to
thank Senator Grassley for signing onto the Senate DIR reform letter and for
all of his advocacy for Iowa pharmacy and consumers. These fees are ‘legalized
theft’ for both the patient that they were designed to ‘care for’ and the
community pharmacies that provide the care, as these ‘fees’ cause patients to
pay higher out of pocket costs for their medications. When the PBM imposes these
‘retroactive DIR fees’ they do not make any adjustments to the patients’ out of
pocket costs which in most cases would be less based on the modification of the
cost of the medication. Also, with DIR fees, the pharmacy does not know how
much they will get paid for prescriptions until months later which is what
makes cash flow management difficult to assess. In addition, the proposed
action will assist with maintaining the viability of Iowa’s community
pharmacies, especially in rural Iowa where access to care is already
suffering,” said Cory Garvin and
Michelle Garvin, owners of Wester Drug Pharmacy in Muscatine.
"I commend
and support the work that Senator Grassley is doing to lower prescription drug
costs and his focus on ending retroactive DIR fees. It is important that we
recognize that DIR fees, in general, have morphed from the intent from
CMS—passing manufacturer rebates and other price adjustments to the ultimate
payer (in this case CMS). Today, DIR fees have a myriad of meanings, are not
transparent, and negatively impact the pharmacy, and more importantly the
patients our pharmacists are serving. DIR fees are cloaked in unnecessary
vagueness and complexity—the only ones who seem to understand them are the same
entities (PBMs) that have exploited them. It begs the question, who does it
really benefit? Certainly not the payer nor the patient. Addressing retroactive
DIR fees is a start and I applaud Senator Grassley’s lead on this issue.
Ultimately, let’s work together to determine a fair reimbursement system that
keeps the rural pharmacies open while lowering out-of-pocket drug costs for
patients,” said Randy McDonough, CEO of
Towncrest Pharmacy Corp.
Grassley has
previously called for pharmacy DIR fee reforms, including in a bipartisan
letter sent by 23 senators in
September 2019; in the bipartisan
PDPRA
that prohibited retrospective recoupment of payments to pharmacies by Part D
plans and PBMs; and in remarks to
business leaders and
health care advocates when discussing PDPRA.
Throughout 2021
and 2022, Grassley has spoken about his bipartisan efforts to lower
prescription drugs costs with President Biden, Speaker Pelosi, Health and Human
Services (HHS) Secretary Becerra, members of the Problem Solvers Caucus Health
Care Working Group, rank-and-file members of Congress and White House staff. In
2019, PDPRA passed the Senate Finance Committee under the leadership of then
Chairman Grassley on a bipartisan vote, 19 to 9. As chairman, Grassley held
three hearings on lowering the cost of prescription drug prices, led a bill
mark-up and conducted numerous bipartisan meetings to advance the bipartisan
deal.
You can find additional details about the
bipartisan PDPRA by clicking
HERE.
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