Readers may remember the Part D rebate final rule finalized by Health and Human Services (HHS) late last year. After the rule was finalized, the Pharmaceutical Care Management Association (PCMA) filed suit against the Trump Administration to block it, arguing that the rule would lead to higher premiums in Medicare Part D and that in making the final rule, HHS and the Centers for Medicare and Medicaid Services (CMS) did not effectively coordinate with each other.
PCMA argued that drug rebates have been standard in commercial plans, which Part D was modeled after. The organization further argued that the rule threatens manufacturers, PBMs, and plan sponsors with significant criminal and civil liability under the federal anti-kickback statute just for engaging in the same rebate practices that they have followed since the start of the Medicare Part D program and that are consistent with the commercial insurance market that Congress intended for Part D plans to imitate.
Pharmacy benefit managers (PBMs) will be happy to learn that they now have extra time to prepare for the final rule. On January 30, 2021, Judge John D. Bates with the United States District Court for the District of Columbia issued an order postponing the effective date of the final rule from January 1, 2022, to January 1, 2023. However, the postponement does not impact provisions of the rule that were scheduled to take place prior to January 1, 2022, only those that were scheduled to take effect on January 1, 2022.
PCMA released a statement, saying the rule should be “promptly and permanently repealed,” as it “was haphazardly finalized and clearly circumvented the proper rulemaking process.”
Within that statement, PCMA President and CEO JC Scott applauded the Biden administration “for agreeing to delay the January 2022 effective date for the rebate rule While we are pleased with the delay and have agreed to pause our litigation for a reasonable period of time to allow the administration to review the rule, if the administration does not, after its review, retract the rule or propose a satisfactory solution to resolve our legal claims, or timely conclude its review, we will be forced to ask the court to reactivate the suit.”
The order also indicated that the case will be held in abeyance while HHS undertakes a review of the final rule. Parties are also instructed to submit a joint status report regarding whether and how the case should progress by April 1, 2021. Based on the statement released by PMCA, it’s safe to say they will continue pushing for the repeal of the rule.