Source: United States Senator for Oklahoma James Lankford
03.11.22
WASHINGTON, DC – Senator James Lankford (R-OK), a member of the Senate Finance Committee with jurisdiction over the Centers for Medicare and Medicaid Services (CMS), joined Senator Jon Tester (R-MT) led a bipartisan group of 30 Senators in urging CMS Administrator Chiquita Brooks-LaSure to stop all retroactive direct and indirect remuneration (DIR) fees, a commonsense reform that could reduce seniors’ out-of-pocket drug costs by more than $21 billion over the next decade.
Earlier this year, Lankford celebrated a huge win for Oklahoma seniors and local pharmacies as Medicare officials announced a proposal for sweeping changes to Medicare Advantage and Medicare Part D plans for seniors. Part of this new proposal from CMS mimics plans for lowering out-of-pocket drug costs for beneficiaries on which Lankford has advocated for several years.
Lankford and Tester were joined in sending this letter by Senators Shelley Moore-Capito (R-WV), Sherrod Brown (D-Oh), Marsha Blackburn (R-TN), Tom Carper (D-DE), John Boozman (R-AR), Bill Cassidy, M.D. (R-LA), Susan Collins (R-ME), Tom Cotton (R-AR), Steve Daines (R-MT), Joni Ernst (R-IA), Chuck Grassley (R-IA), John Hoeven (R-ND), Cindy Hyde-Smith (R-MS), Jim Inhofe (R-OK), Angus King (I-ME), Patrick Leahy (D-VT), Cynthia Lummis (R-WY), Roger Marshall, M.D., (R-KS), Bot Menendez (D-NJ), Lisa Murkowski (R-AK), Rand Paul, M.D. (R-KY), Debbie Stabenow (D-MI), Dan Sullivan (R-AK), Thom Tillis (R-NC), John Thune (R-SD), Chris Van Hollen (D-MD), and Roger Wicker (R-MS).
The senators wrote in their letter, “Addressing pharmacy DIR fees is essential to ensure beneficiary access to pharmacies that provide lifesaving prescription drugs and other essential services like chronic and complex disease management, wellness and prevention, vaccines, testing, and medication therapy management… Thank you for your commitment to these comprehensive reforms and for including this important proposal to reform Medicare pharmacy DIR as part of CMS’ CY23 proposed rule. We urge you to strengthen these provisions and finalize them in the final rule, and we look forward to continuing to work with you to support Medicare beneficiaries and the pharmacies that serve them.”
You can read the full letter HERE and below
Dear Administrator Brooks-LaSure:
We write to urge the Centers for Medicare and Medicaid Services (CMS) to finalize the proposal included in the proposed rule for Contract Year 2023 Policy and Technical Changes to the Medicare Advantage and Medicare Prescription Drug Benefit Program (CY23 proposed rule) to help lower the cost of prescription drugs for Part D beneficiaries through certain pharmacy direct and indirect remuneration (DIR) fee reform in Medicare.
In its proposed rule, CMS states that pharmacy DIR fees grew more than 107,400 percent between 2010 and 2020. The meteoric rise of these fees, coupled with the lack of transparency in their application in the Part D program, is contributing to increasing prescription drug costs for patients and the closure of hundreds of pharmacies in communities across the country.
Pharmacy DIR fees applied after the point-of-sale artificially increase patients’ out-of-pocket costs for Part D drugs, which is why CMS’ proposed reform to bring these fees to the point-of sale will help achieve meaningful drug savings for seniors. In fact, the reforms offered by CMS in the proposed rule alone are estimated to reduce seniors’ out-of-pocket prescription drug costs by $21.3 billion over 10 years.
Additionally, pharmacies are an integral pillar of health care throughout the United States, and often the sole provider of needed health care services in our rural and medically underserved communities. Addressing pharmacy DIR fees is essential to ensure beneficiary access to pharmacies that provide lifesaving prescription drugs and other essential services like chronic and complex disease management, wellness and prevention, vaccines, testing, and medication therapy management. Over the past two years, we witnessed how important access is as the nation continues to rely on pharmacies to care for underserved and at-risk communities by ensuring access to COVID-19 testing, vaccination, and therapeutics. Enacting Medicare pharmacy DIR fee reform will help sustain beneficiary access to these essential services.
We thank you for your work on the draft rule and your effort to address DIR fees in the proposed rule. However, in addition to finalizing this proposal, more can and should be done to deliver comprehensive pharmacy DIR fee reform. In December, you agreed with Congress in your response letter stating, “That the significant growth in DIR amounts is troubling” and pledged to address this through the agency’s rulemaking authority. We want to ensure this rule meets that promise and truly stops all post-sale concessions charged to pharmacies, including those assessed in the Medicare coverage gap. It is important that CMS work with stakeholders to ensure this provision is as comprehensive as possible prior to finalizing the rule.
Further, CMS should take additional steps to protect beneficiary access to pharmacies by ensuring pharmacies’ actual reimbursement, inclusive of all DIR fees, is reasonable as required under existing statute. Finally, we urge CMS to work with industry stakeholders – including community pharmacies and specialty pharmacies – to establish meaningful, standardized pharmacy performance metrics to increase quality and consistency across the Medicare Part D program. We recognized the importance of these transparent performance measurers by including them in the Pharmacy DIR Reform to Reduce Senior Drug Costs Act (S. 1909).
Without standardized performance metrics, pharmacies will continue to be forced out of networks due to low reimbursement, limiting patient access to prescription drugs.
Thank you for your commitment to these comprehensive reforms and for including this important proposal to reform Medicare pharmacy DIR as part of CMS’ CY23 proposed rule. We urge you to strengthen these provisions and finalize them in the final rule, and we look forward to continuing to work with you to support Medicare beneficiaries and the pharmacies that serve them.
Sincerely
###