The NCSL Blog


By Haley Nicholson

American Patients First,” a blueprint looking at ways to increase affordable prescription drug access for all Americans, was released by the administration in May.

Prescription drugsWithin this report are many questions posed to health care providers, consumers, insurers and pharmaceutical groups involved in the prescription drug pricing process.

Top challenges identified in the report include: high list prices for drugs, seniors and government programs overpaying, high and rising out-of-pocket costs for consumers, and foreign governments using American innovation requirements to avoid investment rules.

The blueprint also makes a request for information to weigh in on their proposals. Comments are due by July 16, 2018.

One of the most prevalent themes throughout the paper is to enhance Medicare and Medicaid’s bargaining power to make drug prices more transparent and affordable for the programs’ enrollees. Proposals to expand Medicaid’s drug pricing power includes a five-pilot state demonstration that will test different bargaining models.

Within Medicare the blueprint proposes shifting Medicare Part B drugs into Medicare Part D, making the case that Part D will enhance part Part D’s role by becoming more like the private sector in prescription drug pricing negotiations.

The paper has a critical eye on reforming prescription rebate programs focusing on Medicaid, the 340B drug discount program, and Pharmacy Benefit Managers (PBMs). If PBM sounds familiar it’s likely because their role in the prescription pricing process has come under scrutiny both at the state and federal level.

Similar to current state and federal policy proposals, the blueprint looks at ways to turn power away from PBMs by lifting the pharmacy gag clauses they have implemented. The blueprint proposes lifting the gag clauses, allowing pharmacists to tell consumers what the drug price would be if they paid in cash, and use this new practice to increase transparency between providers, consumers, insurers and manufacturers.

Recently, the Senate Finance Committee asked HHS Secretary Alex Azar to answer their questions about the blueprint. Senate Democrats have several concerns with this proposal, including that shifting some drugs from Medicare Part B to D would increase drug prices because many seniors don’t have Part D insurance and, in some instances, are unable to afford it. Democrats are also concerned that Azar and other HHS officials involved in creating this report are too closely tied to their past roles at pharmaceutical companies.

After the release of the blueprint, the administration also called for drug manufacturers to voluntarily drop their prices. To date no major drug manufacturers have responded to the ask.

NCSL will continue to follow White House and congressional action as they pursue ways to lower prescription drug prices, with the final goal of providing American consumers with a variety of prescription drug options.

Additional Resources

Haley Nicholson is a policy director, health, in NCSL's State-Federal program based in Washington, D.C.

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This blog offers updates on the National Conference of State Legislatures' research and training, the latest on federalism and the state legislative institution, and posts about state legislators and legislative staff. The blog is edited by NCSL staff and written primarily by NCSL's experts on public policy and the state legislative institution.