“Patients in Utah and across the country are strapped with skyrocketing prescription drug costs, while insurance companies and drug manufacturers benefit from a complex system of rebates that results in higher drug costs,” Senator Romney said. “By changing the rules of cost-sharing, our bill aims to bring transparency to the prescription drug pricing system and lower out-of-pocket costs for medication.”
“The current system of government-sanctioned rebates for prescription drugs has distorted the drug pricing market. Drug prices—and out of pocket expenses paid by consumers—seem to continually be on the rise,” Senator Braun said. “What is not talked about enough, however, is the inherent conflict of interest arising from negotiated rebates that affect the actual cost of drugs, which are paid by drug makers to pharmacy benefit managers (PBMs) in exchange for preferred status on insurers’ health plan formularies. This creates a perverse incentive for drug makers to continually increase drug list prices—at the expense of consumers. And even when drugs are covered by insurance—consumers with cost-sharing obligations are often required to pay 30 to 40 percent of high drug list prices out of their own pocket.
“These rebates are often hidden from consumers, contribute to high list prices for prescription drugs, and leave consumers with all, or a big part of the tab,” Braun continued. “That’s why I’m introducing a bill with Sen. Mitt Romney to ensure that any co-insurance obligations for consumers are set as a percentage of ‘net-prices,’ or the after-rebate price, instead of inflated list prices. Lawmakers on both sides of the aisle must realize that the current system of distortive rebates creates perverse incentives for drug makers and PBMs. It also puts consumers’ health at risk—as many struggle to adhere to their medication routine as a result of high list prices. This has to stop and the bill that I’m introducing with Sen. Romney lays the foundation for the significant drug pricing reforms that this country is in desperate need of.”