MANAGED CARE NEWSSTAND FDA Proposes Rule to Allow Importation of Prescription Drugs The U.S. Food and Drug Administration (FDA) issued a proposed rule in December seeking comments on a proposal to amend Section 804 of the Food, Drug, and Cosmetic Act that would allow the importation of prescription drugs from Canada. President Trump has expressed support for the notion as a way to reduce drug costs. States including Florida, Colorado, Maine, and Vermont have expressed interest in the proposal. PhRMA, the trade association representing the drugmanufacturing industry, has expressed concern, calling the proposal a political move rather than a pragmatic policy solution. There are no estimates as to the possible savings under the rule, since it is unclear how many states might participate. The FDA framed it as a proof-in-concept proposal that could be expanded if successful. The rule-making process is expected to take some time.
House of Representatives Passes Legislation to Require Government Negotiations of High-Cost Drugs The U.S. House of Representatives passed legislation in December that would require the federal government to negotiate payment rates for up to 250 of the highest-priced drugs in the U.S. that face little or no competition. Negotiations would be based on an international pricing index that averaged the prices of drugs from six developed countries (France, Canada, Germany, UK, Japan, and Australia), with prices capped at 120% of the international
4 | Magellan Rx Report | Spring 2020
In February, the Centers for Medicare & Medicaid Services issued its proposed rule and Advance Notice Part II for changes to the Medicare Advantage and Part D programs. pricing index. The Congressional Budget Office (CBO) estimated that the bill would save more than $450 billion over 10 years. The bill, HR3, passed 230192 with two Republicans in support and no Democrats in opposition. The White House stated it would veto the bill if it reached the president’s desk. The Senate majority leader stated that the bill would not be brought up in the Senate. Senate leaders continue to push for their own drug-pricing legislation. The Senate Finance Committee passed drug-pricing legislation in July that would limit Medicare drug-price increases to the inflation rate; CBO estimated 10year savings at $100 billion. However, the bill has yet to reach the Senate floor. Many Republican senators oppose the bill, calling it government interference in the marketplace. Senate majority leader Mitch McConnell stated in February that the bill faced “internal divisions” among Republicans and would not likely move to a floor vote until those divisions could be overcome. The committee bill
passed 19-9 with all Democrats voting in favor of the bill and nine Republicans on the Republican-led committee voting against it.
CMS Releases Advance Notice and Proposed Rule for Medicare Advantage and Part D Programs In February, the Centers for Medicare & Medicaid Services (CMS) issued its proposed rule and Advance Notice Part II for changes to the Medicare Advantage (MA) and Part D programs. The proposed changes are expected to increase payments in the MA program by 0.93% and in the Part D program by 2.85%. The proposed rule intends to do the following: • Codify the SUPPORT Act, a recent law dealing with opioids that requires Part D plans to implement drugmanagement programs by 2022. • Amend network adequacy requirements. • Prevent contracting with look-alike Dual-Eligible Special Needs Plans. • Allow individuals with end-stage renal disease to enroll in MA plans beginning in 2021, removing the prohibition that has been in place before the passage of the 21st Century Cures Act. • Allow for a second “preferred” specialty tier with lower cost-sharing obligations. • Call for real-time drug-pricing cost comparisons beginning in 2022.
CREATES Act Included in Final End-of-Year Spending Bill Passed by Congress President Trump reached an agreement with Congress in December on an end-ofyear spending bill for 2020. The federal government had been operating on a temporary spending bill since Oct. 1, the
