Direct-to-consumer drug ad prices rule hints at future avenues for pharmacist reimbursement
Beginning in July 2019, manufacturers’ direct-to-consumer (DTC) television ads for prescription drugs and biologic products covered by Medicaid and Medicare must include their wholesale acquisition cost if it exceeds $35 a month. The requirement, originally proposed in the Trump administration’s American Patients First blueprint to lower drug prices, comes as a result of a U.S. Health and Human Services (HHS) Department final rule published in the Federal Register on Friday, May 10, 2019.
List price versus patient price
“Requiring the inclusion of drugs’ list prices in TV ads is the single most significant step any administration has taken toward a simple commitment: American patients deserve to know the prices of the health care they receive,” said HHS Sec. Alex Azar in a media release. “Patients who are struggling with high drug costs are in that position because of the high list prices that drug companies set. Making those prices more transparent is a significant step in President Trump’s efforts to reform our prescription drug markets and put patients in charge of their own health care.”
The inclusion of wholesale acquisition cost (WAC), or list price, is intended to foster competition among drug companies and arm patients with knowledge that will allow them to take a more active role in their health care choices. Manufacturers have criticized, however, that list price paints an inaccurate picture of what a drug costs a patient at the pharmacy counter, since payers and PBMs negotiate prices using drug rebates.
HHS addressed this by mandating the inclusion of a disclaimer stating that, “The list price for a [30-day supply of] [typical course of treatment with] [name of prescription drug or biological product] is [insert list price]. If you have health insurance that covers drugs, your cost may be different.”
HHS has also pledged to eliminate drug rebates if savings aren’t shared with the patient at point of sale. If these efforts are completed, the list price would apply to everyone.
A place for pharmacists
The DTC ad final rule has implications for pharmacists beyond virtually guaranteeing patients will come into the pharmacy with more questions than answers on why their drugs cost what they do.
The rule notes that many commenters told HHS that pharmacists are the best source of education on the cost of drug therapies, and that “[knowing] the WAC may also help a beneficiary begin a conversation about less expensive alternatives, prompt them to ask their pharmacist if a lower-cost option would be available, or encourage them to choose a plan with more favorable cost-sharing requirements.”
HHS stated that it believes “patient counseling, care planning and navigation, and shared decision making are valuable to patients and important for delivering high quality care. We also agree that pharmacists may be able to provide information on drug pricing and patient coinsurance to patients and advise patients on the availability of less expensive drugs in the event cost is a barrier to medication adherence.”
In acknowledgment of those factors, the agency wrote that it will “consider a counseling code for future rulemaking in the appropriate benefit categories as allowed by statute” to reimburse pharmacists and other providers who help patients control their drug costs.
Tice letter to Congress
In other drug prices news, APhA President Brad Tice, PharmD, MBA, FAPhA, sent a letter to the U.S. House of Representatives Committee on Energy and Commerce urging them to act on PBMs’ “chicanery” and to pass legislation that “[disallows] all types of fees, monetary exchanges, and exchanges of value that discount the pharmacy’s drug cost.”
Pharmacy hours and wages are being cut, independent pharmacies are closing, and patients are losing access to care, Tice wrote. “The question begging to be answered is, ‘How can pharmacists, as the actual providers of medication and quality care with medications, be getting paid less and how can pharmacies be getting forced out of business, when drug prices are skyrocketing?’ This crisis speaks to the perverse pricing practices utilized by the middle of the drug supply chain industry.” Such practices, along with federal reimbursement levels that may not even cover acquisition costs, have placed unprecedented strain on the practice of pharmacy, Tice said.
Tice’s letter decried direct and indirect remuneration (DIR) fees, “which utilize a regulation intended to make pharmacy contracts more transparent, that have become a profit center for PBMs by artificially tying manufacturer rebates to pharmacies. There simply is no connection between the cost of the drug a pharmacy pays to their wholesalers and a pharmacy’s performance on measures to improve the quality of patient care.”
He also emphasized that pharmacists’ patient care services improve outcomes and reduce costs to the health care system. “As private health plans align their policies with Medicare policies, pharmacists are being routinely excluded from providing direct patient care services across the country that can improve patient care and reduce health care costs,” Tice wrote. “Pharmacists can be a significant part of the solution to rising costs.”