CMS proposes price transparency rule that targets PBMs

Manufacturers, pharmacy benefit managers and managed care plans would have to be more transparent about Medicaid drug prices under a rule proposed this week by the Centers for Medicare & Medicaid Services.

“This proposed rule prioritizes CMS’ role as a good steward of Medicaid dollars while also strengthening program integrity and the management of pharmacy benefits for people with Medicaid coverage,” CMS Administrator Chiquita Brooks-LaSure said. “We’re committed to preserving access to life-saving treatments and securing fiscal sustainability for the Medicaid program, which remains a lifeline for millions of people.”

Managed care plans cover more than three-fourths of Medicaid beneficiaries, according to CMS. Although PBMs in these plans often negotiate and administer the pharmacy benefit, there has been a lack of transparency into the amount plans have paid to PBMs for administering the drug benefit and the amount pharmacies have been paid for the drugs. This lack of transparency has raised concerns about PBMs using spread pricing arrangements.