A number of legislative priorities are in question after President-elect Donald Trump and Elon Musk on Wednesday worked to end a bipartisan deal on government funding.
They include measures that community pharmacists say are the most significant efforts yet to rein in pharmacy middlemen, who they say are largely to blame for rising prescription drug prices. These are actions for which Trump himself has expressed support.
As the deadline for a divided Congress to pass legislation keeping the government open approaches, Ohio’s Elon Musk and Vivek Ramaswamy worked Wednesday morning to disprove it. Ramaswamy helps Musk run Trump’s unofficial “Department of Government Efficiency.”
Both men issued public statements sharply criticizing the lingering resolution as containing too much “pork” or unnecessary government spending. They received Musk’s own companies tens of billions in government funds.
But on Wednesday afternoon, Trump and many Republicans in Congress joined in the panic and gave up on the spending deal grave doubts. If the agreement is not adopted, the government will cease operations on Friday at midnight.
The chaos has certainly left a huge number of groups scrambling to preserve the policy priorities they worked on to get to a budget deal. These include reforms to the way pharmacy intermediaries, called pharmacy benefit managers, conduct business.
The three largest, also known as PBMs, control access to 80% of insured patients in the United States. Each is part of a sprawling health care conglomerate that ranks among the nation’s 15 largest corporations by revenue.
They act on behalf of insurers (each of their parent companies has top 10 insurers) to manage transactions with drug manufacturers and pharmacies.
Because PBMs decide which drugs are covered, they have enormous leverage to obtain murky rebates and fees from drugmakers in exchange for coverage for their products. It’s such a practice tests and Federal Trade Commission they say this increases out-of-pocket costs, especially for poorer patients.
Meanwhile, pharmacies say PBMs exploit a bewildering array of murky cost lists to reimburse them for dispensed drugs, and they say reimbursements often do not cover their expenses. In Ohio in 2017, two of the substantial three billed the Medicaid system almost a quarter of a billion dollars more for drugs than they paid to the pharmacies that dispensed them.
Since 2018, the role PBMs play in drug costs has come under increasing public scrutiny. State prosecutors and federal regulators have already done so filed lawsuits AND lawmakers tried to limit it their practices.
As the U.S. House of Representatives set its spending agenda in recent weeks, critics’ concerns about PBMs seemed to be gaining attention. On Tuesday, the National Pharmacists Association released a statement titled “We are on the verge of groundbreaking PBM reforms.”
Among the measures in the continuing resolution was one that would stop PBMs from paying hundreds of different, murky prices for the same drug in state Medicaid programs. Instead, all refunds will be based on the same publicly available list.
Another measure would stop PBMs from forcing pharmacies covered by Medicare Part D programs to have “take-it-or-leave-it” contacts. Pharmacists say they must accept any terms offered by huge PBMs because they cannot afford to lose so many customers.
Earlier this week, PBM critics believed Trump was firmly on their side.
“A terrible middleman who, frankly, makes more money than pharmaceutical companies and they do nothing but act as a middleman.” As reported by USA Today on Monday. “I don’t know who these middlemen are, but they are rich.”
Trump added: “We are going to cut out the middleman. We are going to bring drug costs down to levels that no one has ever seen before.”
This pushed up the stock prices of the conglomerates that own the three largest PBMs – UnitedHealth Group, CVS Health and Cigna-Express Scripts – falling.
Then came Wednesday’s confusing statements about pork by Trump and two other tycoons that could shut down the government and thwart PBM reforms that are part of the ongoing resolution.
“The health care package that we and many of you lobbied members of Congress on this week crashed and burned last night,” the National Pharmacists Association said in a statement to its members Thursday. “A complete train wreck, caused in large part by the head of President-elect Donald Trump’s unofficial Department of Government Efficiency.”
This last statement was a reference to Musk.
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