White House Decision to Kill Proposed Medicare Part D Rebate Rule Follows Months of Roundtable Advocacy

Over the past several months the Public Sector HealthCare Roundtable has been extremely vocal in opposing the proposed rule to eliminate rebates in Medicare Part D. The Roundtable has been concerned that, if finalized, the proposal would lead to substantially higher costs in Medicare Part D for public sector retirees and their families. 

On Tuesday, June 25th, Roundtable members met with John O’Brien, Senior Advisor to the Secretary of Health and Human Services for Drug Pricing Policy, to express their concerns regarding the pending rule. The meeting was held in conjunction with the Roundtable’s 2nd Annual Congressional Forum.

On June 5th, the Roundtable submitted a letter to the CMS Administrator to express strong concern for the recent CMS proposal to exempt Medicare Employer Group Waiver Plans (EGWPs) from the relief given to individual Medicare Part D plans in recent CMS guidance as it relates to the proposed elimination of the safe harbor protection for manufacturer rebates in Part D. The new guidance would drastically increase premiums for EGWP retirees. The letter requested that CMS issue additional guidance that offers financial relief to EGWPs and their beneficiaries at parity with the guidance on April 5, 2019 to individual Part D plans and beneficiaries. The letter was signed by the Roundtable and the following public plans:

  • California Public Employees Retirement System 
  • Colorado Public Employees’ Retirement Association 
  • New Mexico Retiree Health Care Authority 
  • North Carolina State Health Plan 
  • Ohio Public Employees Retirement System 
  • School Employees Retirement System of Ohio 
  • State Teachers Retirement System of Ohio 
  • State of Oklahoma – HealthChoice 
  • Teachers’ Retirement System of Kentucky 
  • West Virginia Public Employees Insurance Agency

On April 8th, in response to the original CMS proposal, the Roundtable submitted comments to the HHS Office of Inspector General strongly recommending that OIG leave in place the existing safe harbor for rebates negotiated between drug manufacturers and PBMs contracting with Medicare Part D plans. Those comments resulted from a Roundtable membership conference call and a subsequent membership survey designed to solicit data regarding the impact of rebates on plan members.