[Congressional Record (Bound Edition), Volume 163 (2017), Part 3]
[Extensions of Remarks]
[Page 4103]
[From the U.S. Government Publishing Office, www.gpo.gov]




                          COMMUNITY PHARMACIES

                                  _____
                                 

                        HON. H. MORGAN GRIFFITH

                              of virginia

                    in the house of representatives

                        Thursday, March 9, 2017

  Mr. GRIFFITH. Mr. Speaker, last month Congressman Welch and I 
introduced legislation H.R. 1038, Improving Transparency and Accuracy 
in Medicare Part D Spending Act. The legislation would help ensure that 
small business pharmacies get reimbursed at the rate they agreed to 
when they signed the reimbursement contract with the pharmacy benefit 
manager (PBMs).
  Our bill would prohibit the PBMs/health plans from retroactively 
reducing pharmacy reimbursement that has already been contractually 
agreed to. If you fill up your gas tank when the price is $2.09 per 
gallon and the price later goes up to $2.15, you won't receive a bill 
demanding payment for the extra six cents per gallon. The same 
principle should apply to our community pharmacists. They deserve to be 
reimbursed based on the price of drugs when they are dispensed, not 
when they are charged. The fact that the PBMs can even do this points 
to the need for action on this bill and the need for broader 
Congressional scrutiny of large PBMs.
  Most Americans don't know who the large PBMs are and what they do--
three large PBMs control roughly 78 percent of the market and manage 
pharmacy benefits for more than 180 million Americans. PBMs not only 
manage benefits for insurance companies and employers, they also own 
their own pharmacies whether that is mail order, specialty or retail.
  Unfortunately small pharmacies in Southwest Virginia and Vermont have 
dealt with direct and indirect remuneration (DIR) fees for the last few 
years and the fees are only getting worse. The inability of small 
business community pharmacy owners to plan in advance for these 
retroactive fees is truly threatening their ability to operate.
  Additionally these fees push patients into the donut hole faster than 
they would otherwise, a fact that CMS has stated. CMS has also stated 
these fees are increasing costs to the government, especially in the 
catastrophic phase of the Part D program. Virtually all catastrophic 
costs in Part D are borne by the government, and they have increased 
dramatically in recent years--from $10 billion in 2010 to $33 billion 
in 2015--fueled by pharmacy DIR fees. These PBMs have an extremely 
robust business relationship with the Federal Government in Part D, 
FEHB and DOD TRICARE so it certainly seems possible that the Federal 
Government could be paying more for prescription drugs than it should 
be.
  Our bill was introduced with 15 original cosponsors and we hope that 
it will see action in the 115th Congress. Prohibiting retroactive fees 
like this would help CMS have a better ability to understand all the 
prescription drug spending that is occurring in Medicare Part D. 
Additionally, Senators Shelley Moore Capito (R-WV) and Jon Tester (D-
MT) introduced identical legislation on the Senate side which seeks to 
attain the same goals. We very much appreciate their leadership on this 
issue.