Trump administration pressures Congress to lower Medicare drug prices by ending industry’s ‘backdoor deals’

The Trump administration on Friday called on Congress to pass its proposed ban on “backdoor deals” that pharmaceutical companies cut with middlemen who get preferred status for their drugs in Medicare’s prescription drug plans.

The proposal, unveiled Thursday, would pass an estimated $29 billion in rebates paid to so-called pharmacy benefits managers to consumers. Drug manufacturers pay PBMs the rebates for getting their drugs covered by Medicare’s Part D prescription plan. Instead, PBMs would get a flat fee for including drugs on their plans. The rule would also create a new so-called safe harbor for drug discounts to be passed on to patients at the pharmacy counter.

Health and Human Services Secretary Alex Azar also urged Congress to extend the rule to employer-sponsored and other private insurance plans.

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