S-4199 : Still Just a Bill

Prescription Drug Pricing Reduction Act of 2020

This bill alters several programs and requirements relating to the prices of prescription drugs under Medicare and Medicaid.

Among other things, the bill

• requires drug manufacturers to issue rebates to the Centers for Medicare & Medicaid Services (CMS) for certain drugs covered under Medicare for which the average manufacturer price increases faster than inflation;
• requires drug manufacturers to issue rebates to the CMS for discarded amounts of certain single-dose drugs covered under Medicare, based on information reported by providers;
• reduces the annual out-of-pocket spending threshold, and eliminates beneficiary cost-sharing above this threshold, under the Medicare prescription drug benefit;
• requires the CMS to publish certain information, as reported by pharmacy benefit managers (PBMs), relating to drug discounts and rebates, and payments between PBMs, health plans, and pharmacies;
• requires pass-through pricing models, and prohibits spread-pricing, for payment arrangements with PBMs under Medicaid; and
• increases the maximum rebate payable by drug manufacturers under the Medicaid Drug Rebate Program.