In a statement to the Senate Finance Committee today, NACDS stressed the importance of assuring the finalization of Secretary of Health and Human Services (HHS) Alex Azar’s proposals to reform pharmacy direct and indirect remuneration (DIR) fees, and of developing a standardized pharmacy quality incentive program. NACDS’ statement also addressed opioid-abuse prevention; the implementation of the new gag-clause prevention law; maintaining prescription-drug access for Medicare beneficiaries; empowering prescribers to make coverage determinations and access cost information at the point of prescribing; and integrating a patient-specific real-time benefit tool into the Part D benefit.


  • NACDS’ comments reflect extensive comments submitted to the Centers for Medicare & Medicaid services in January.
  • DIR fees are based on a regulatory loophole that plans have exploited to increase beneficiary drug costs. DIR fees are being misused by payers to claw back reimbursement to pharmacies for the prescription drugs that they provide to Medicare beneficiaries. Interpretations of specific terms that are used in the Medicare program related to pharmacy reimbursement and drug pricing have led to these claw-backs, and ultimately to higher out-of-pocket drug costs for patients and increased costs for the government.
  • Regarding the Senate’s ongoing engagement in this issue, in February nearly one-third of the Senate signed a bipartisan letter that urged Secretary Azar to advance his DIR fee reform proposals.

“The FY2020 HHS Budget Request notes steps the Department took in the past year aimed at lowering the cost of prescription drugs, including ensuring beneficiaries are benefiting from price concessions at the pharmacy counter. We urge HHS to continue these actions in FY2020 by finalizing provisions in the November 2018 Centers for Medicare & Medicaid Services (CMS) proposed rule ‘Modernizing Part D and Medicare Advantage to Lower Prices and Reduce Out-of-Pocket Expenses’ that would increase competition in the Medicare Part D program and lower beneficiary out-of-pocket costs by reforming pharmacy [DIR] fees. CMS has proposed to reform pharmacy DIR by requiring that pharmacy price concessions are passed on to patients…Finalizing pharmacy DIR reform needs to be coupled with the development of standardized pharmacy quality metrics and a pharmacy quality incentive program.”

– NACDS statement to the Senate Finance Committee

See NACDS Op-ed