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The Health 202

A newsletter briefing on the health-care policy debate in Washington.

Lawmakers are readying fresh attacks on pharmacy middlemen

The Health 202

A newsletter briefing on the health-care policy debate in Washington.

TGIF, everybody. We hope you enjoy the long weekend. In observance of Martin Luther King Jr. Day, we won’t be publishing Monday, but see you here bright and early Tuesday. ☀️

Today’s edition: A dip in the measles vaccination rate among kindergartners is raising alarms. The Centers for Disease Control and Prevention will soon have a new principal deputy director. But first … 

Pharmacy benefit managers could soon be back in the hot seat

As key lawmakers gear up for the new Congress, there’s at least one industry that will be caught in the crosshairs: pharmacy benefit managers. 

These prescription drug middlemen are essentially third parties that help manage prescription drug benefits on behalf of both public and commercial insurers. Some top lawmakers are already pledging oversight into PBMs’ practices, accusing them of contributing to the high cost of medicines. 

As they do so, the main PBM lobby — the Pharmaceutical Care Management Association — is gearing up to roll out a policy agenda as it maintains the industry helps lower costs for patients.

The dynamic is just the latest salvo in the years-long drug-pricing wars, where lawmakers haul CEOs in front of congressional committees and launch probes in attempts to demystify the nation’s complicated pricing schemes. But even when lawmakers in both parties agree they want to tackle a problem, that doesn’t mean they’ll be able to craft bipartisan legislation that can pass in a divided Congress. And some experts want to ensure lawmakers don’t let other industries off the hook in their quest to examine PBMs.

  • “PBMs are not, in fact, the sole cause of patients’ inability to afford their medication, and so efforts by some members of Congress to focus on PBMs as the primary bad actors I think are incomplete,” said Rachel Sachs, a professor at Washington University in St. Louis School of Law. “But absolutely PBM reform should be part of a broader inquiry.”
The details

Pharmacy benefit managers are no stranger to the spotlight, and the scrutiny tends to revolve around several different tactics.

For instance, such criticism has fallen on a practice known as spread pricing, when PBMs charge payers more than they pay to the pharmacy and keep the difference. Lawmakers have also called for and introduced bills aimed at prohibiting spread pricing — which the industry contends can be an important “risk mitigation model” for PBMs — and requiring public disclosure of the total amount of rebates manufacturers pay to PBMs, and how much of that is then passed on to health plans. 

On Capitol Hill, some lawmakers are readying their attacks amid an ongoing inquiry by the Federal Trade Commission.

  • Rep. James Comer (R-Ky.), the chair of the House Oversight and Accountability Committee, is planning to hold a hearing on the drug middlemen early in the 118th Congress, he told The Health 202 in a statement.
  • Rep. Buddy Carter (R-Ga.), a pharmacist and frequent PBM critic, said in an interview that he’s planning to launch the congressional Patient Access Caucus, which will focus on PBMs to begin with, though its ultimate scope will be wider.
  • Other lawmakers expressed interest in tackling the industry, while indicating their focus may also be broader. Senate Finance Chairman Ron Wyden (D-Ore.) is “deeply concerned with PBM behavior” and is “committed to taking on all the drivers of high drug prices that are hurting American families, including pharmacy benefit managers,” a panel spokesperson said. Meanwhile, Republicans will “prioritize making health-care costs and prescription drugs more affordable,” including working on actions related to PBMs, per a House Energy and Commerce spokesperson. 
PBM defense

JC Scott, the president and CEO of PCMA, says he wants the industry to capitalize on the moment — and to avoid the “finger pointing” and “blame game” often seen within the drug supply chain. 

“To me, it's an opportunity to do an even better job on educating policymakers, Capitol Hill, the administration, others about who we are and what we do, the value that PBMs bring to the health care system,” he said.

The trade group is planning to unveil a policy platform with its own ideas on how to increase affordability. Scott didn’t go in depth on what those proposals would be, but pointed to the idea of bolstering competition in the marketplace and “address[ing] the places where the system is being gamed,” specifically citing eliminating patent thickets where drug companies allegedly file numerous patents on the same product. 

  • “I hope it's an inflection point where the supply chain can all pivot to more constructive tactics that are focused in on specific policy solutions,” Scott said. 

Public health

Slide in kindergartners’ measles vaccinations raises alarm

Only about 93 percent of American kindergartners were fully vaccinated against measles during the 2021-2022 school year, putting more than 250,000 children at risk for the potentially fatal disease, our colleague Lena H. Sun reports. 

It’s the second year in a row that measles, mumps and rubella coverage has fallen below the 95 percent level needed to prevent the virus from spreading in the community, according to a report released yesterday by the Centers for Disease Control and Prevention

While a two percentage point drop in measles vaccination rates may seem insignificant, even the smallest decline allows the virus to spread more quickly, causing outbreaks in clusters of unvaccinated children, Lena notes. 

  • Vaccination coverage among kindergartners sank below 90 percent in D.C. and nine states, including Ohio and Minnesota, where measles outbreaks sickened more than 100 children last year. 
  • Kindergartners’ immunization rates also continued to decline for three other childhood vaccines that prevent diphtheria, tetanus and pertussis (DTaP), polio and chickenpox. 

Why it matters: The latest data underscores concerns that growing parental resistance to routine childhood immunizations is fueling a resurgence in vaccine-preventable diseases. The pandemic has magnified the issue because of the politicization around coronavirus vaccines, the lingering consequences of school closures and fewer children going to the doctor at the height of the pandemic.

The Post’s Dan Keating:

Agency alert

Maine health official tapped as CDC’s second-in-command

Nirav Shah is leaving his post as Maine’s top infectious-disease official to serve as principal deputy director of the CDC. He will start in March, Maine Gov. Janet Mills (D) announced yesterday. 

Shah, who led the state’s coronavirus response as director of the Maine Center for Disease Control and Prevention, will replace Debra Houry as CDC Director Rochelle Walensky’s second-in-command. His appointment comes amid a larger agency shake-up following sharp criticism of the agency’s handling of covid-19 and last year’s record mpox outbreak. 

In the courts

California sues insulin makers over alleged price gouging

This item has been updated with a response from OptumRx.

California is suing a group of the nation’s largest insulin manufacturers and pharmacy benefit managers, accusing them of using “unlawful, unfair and deceptive” practices to drive up the cost of the lifesaving diabetes drug, Attorney General Rob Bonta (D) announced yesterday. 

The lawsuit alleges that Eli Lilly, Novo Nordisk and Sanofi — which together make over 90 percent of the global insulin supply — and PBMs CVS Caremark, Express Scripts and OptumRx leverage their market power to inflate the price of insulin “in lockstep with each other,” a violation of the state’s Unfair Competition Law. 

Bonta is seeking further court action to prevent future violations of the law as well as unspecified damages for Californians who have overpaid for insulin. 

Daphne Dorsey, associate director for media relations for Eli Lilly, said the company is “disappointed by the California attorney general’s false accusations.” She said that the average monthly out-of-pocket cost for Lilly insulin is $21.80, and urged anyone paying more than $35 per month for Lilly insulin to contact the company. 

In an emailed statement, OptumRx said it “welcomes the opportunity to show the California Office of the Attorney General, just as it has with other States Attorneys General, how we work every day to provide people with access to affordable drugs, including insulin.” None of the other drugmakers or PBMs responded to The Health 202’s requests for comment. 

The bigger picture: Attorneys general in Kansas, Arkansas, Mississippi, Minnesota and Kentucky have filed similar lawsuits in recent years, all of which have accused the companies of abusing their power to stifle competition and boost their profits by inflating the cost of the drug, the Associated Press reports. 

Health Access CA, California’s health-care consumer advocacy organization:

From our reporters' notebooks

Our colleague Lena H. Sun is out this morning with a step-by-step guide for making your own easy-to-assemble, inexpensive portable air filter using materials found at the hardware store or online.

Don’t consider yourself handy? Neither does Lena, but with a little time, grit and lots of duct tape, you’ll be breathing cleaner air in no time. 

Why it matters: The coronavirus isn’t going away anytime soon. And while vaccination, rapid tests and masking are important tools to protect against illness, improving indoor air quality is one of the most surefire ways to reduce the spread of the virus (check out The Health 202’s coverage on the issue here). 

Scientists at the National Institute for Occupational Safety and Health tested the efficacy of DIY air filtration units, including the Corsi-Rosenthal Box that Lena made, in reducing exposure to respiratory aerosols like covid-19, and their study found that the DIY units “reduced aerosol exposure up to 73 percent, depending on the design, filter thickness, and fan airflow.” 

We know what we’ll be doing this weekend. Give it a shot and let us know how it goes at 

More from Lena:

In other health news

  • A federal appeals court in Ohio upheld a lower court’s ruling blocking the Biden administration from enforcing its coronavirus vaccine mandate for workers who contract with the federal government in Kentucky, Ohio and Tennessee, Bloomberg Law reports. 
  • A former CVS Health nurse practitioner is suing the pharmacy chain for allegedly discriminating against her religious beliefs after she was fired for refusing to prescribe contraceptives, according to the lawsuit filed yesterday. 
  • Montana health officials are seeking to require doctors to submit information supporting the need for an abortion to save a patient's life or for any other medically necessary reason in order for Medicaid to pay for the procedure, the Associated Press reports. 

Quote of the week

Health reads

Rep. Wilson shares pain of carrying stillborn pre-Roe: ‘We can’t go back’ (By Kyle Melnick and Mariana Alfaro | The Washington Post)

Some workers at U.S. hospital giant HCA say it puts profits above patient care (By Gretchen Morgenson, Natalie Jimenez Peel and Cynthia McFadden | NBC News )

Bleeding and in pain, a pregnant woman in Louisiana couldn’t get answers (By Rosemary Westwood l WWNO and Kaiser Health News)

Sugar rush

Thanks for reading! See y’all Tuesday.