HHS Secretary Azar Floats Plan to Lower Prescription Drug Costs

As lawmakers in Congress are exploring potential price-lowering options for prescription drugs, Department of Health and Human Services Secretary Alex Azar is floating a proposed rule to lower the prices and out-of-pocket expenses by encouraging manufacturers to pass discounts to patients instead of insurers. The HHS plan is aimed at providing new transparency to the prescription drug market and removing the veil of hidden rebates and other pricing methods currently conducted between companies and pharmacy benefits managers. The rebates and other pricing initiates conducted between the companies, PBMs and insurers are not typically passed along to patients, an HHS fact sheet noted. Azar, a former executive with Eli Lilly, said the “hidden system of kickbacks to middlemen” has forced people to pay more for their medications. Under the proposed rule, prescription drug rebates that today amount to, on average, 26 to 30 percent of a drug’s list price may be passed on directly to patients and reflected in what they pay at the pharmacy counter. Azar said this proposal will benefit all people who buy prescription drugs, but particularly senior citizens who use Medicare Part D. He said the proposal is projected to provide the greatest benefits to seniors with high drug costs.