DIR Reform to Lower Drug Costs

As Congress explores policies to lower the cost of prescription drugs, NACDS recommended several measures to achieve that goal and improve patient health. In a statement to the House Committee on Energy and Commerce Subcommittee on Health, NACDS asserted the value of implementing direct and indirect remuneration (DIR) fee reform to lower drug costs, specifically:

  • Redefining the “negotiated price” to include all pharmacy price concessions. Including all pharmacy price concessions in the negotiated price would reduce its amount and result in lower beneficiary cost sharing;
  • Developing a broad definition of “price concession” to include all forms of discounts, direct or indirect subsidies, or rebates that serve to reduce costs incurred by Part D sponsors. This would help ensure the lowest negotiated price and thus, lower beneficiary cost-sharing.
  • Developing standardized pharmacy performance metrics for 2020. NACDS believes such metrics would be a good first step toward the development of Medicare Part D pharmacy quality incentive program. The Department of Health and Human Services (HHS) needs to develop a pharmacy quality incentive program to align incentives between plans, pharmacies and beneficiaries. Pharmacy incentive payments would drive higher quality health outcomes. Opportunities to increase medication optimization and improve medication adherence would improve patient outcomes and reduce future healthcare costs.

In addition to DIR fee relief, NACDS urged the Subcommittee to develop a pharmacy quality incentive program in the Final Part D Rule. And also require that any manufacturer reduction in prices be passed on to patients at the pharmacy counter in a way that doesn’t harm the supply chain or negatively impact patient health. NACDS also asked to the Subcommittee to convey to HHS the benefits of integrating a patient-specific real-time benefit tool (RTBT) into the Medicare Part D program. This would will give providers and patients the information they need to make more informed decisions on their healthcare options.