Work on drug pricing legislation is underway in Congress, with two House committees holding hearings on the topic in May. The most likely changes are PBM regulation, lowering out-of-pocket costs for Medicare Part D beneficiaries, allowing HHS to negotiate drug prices for Medicare patients, and limiting year-to-year price hikes to no more than the rate of inflation.
While all those policies are on the table, it’s unlikely that all of them would make it through Congress. Majority Democrats have few votes to spare, which means party-line legislation would have to pass through the Senate’s budget reconciliation process in a blockbuster bill that is mainly focused on a Biden administration priority like infrastructure. However, insiders expect the House to pass some version of legislation based on H.R. 3, the Lower Drug Costs Now Act, which includes Part D reform, drug price negotiation and inflation caps. New PBM regulations similar to those proposed by retired Sen. Lamar Alexander (R-Tenn.) in the 116th Congress, including requirements that PBMs pass through all rebate revenue and disclose all negotiated prices to plan sponsors, are under discussion, according to insiders.