January 21, 2010

(Washington, DC) — The Pharmaceutical Care Management Association (PCMA) released the following statement today on new legislation introduced by Congressman Stephen F. Lynch (D-Mass.) — the FEHBP Prescription Drug Integrity, Transparency, and Cost Savings Act (H.R. 4489) — which would increase prescription drug costs and reduce choices for federal employees:

“Congress has enough on its plate without also trying new experiments on the successful Federal Employees Health Benefits Program (FEHBP), one of our nation’s most proven health benefit programs. FEHBP is one of the best-functioning, well-regarded health programs in America and should not be subject to wholesale political changes.

“Health care changes must improve quality, lower costs, and enhance choice and competition. This new legislation runs counter to these goals by radically changing the way federal employees’ prescription drug benefits are administered and would make the FEHBP operate more like those provided through other federal agencies that significantly limit prescription drug choices.

“The legislation would force mandated disclosure of sensitive pricing information, giving the upper-hand to drug makers and drug stores to charge higher prices at the expense of federal employees. Numerous economists and budget experts — including the Federal Trade Commission — have explored this issue and found that the wrong kind of transparency increases, rather than decreases, costs.

“The federal government uses pharmacy benefit managers (PBMs) to ensure that its employees have the most affordable, safe, flexible, and generous prescription drug benefits possible. PBMs lower drug benefit costs by encouraging the use of generic drug alternatives, negotiating discounts from manufacturers and drug stores, saving money with home delivery, and using health information technology like e-prescribing to reduce waste and improve patient safety.

“The utilization of these tools is important as the FEHBP is designed to keep the federal government competitive in attracting and retaining personnel who might otherwise choose to work in the private sector. This private sector approach is much different from the ones used by other government programs such as the Veterans Administration (VA). To save money, those programs simply use artificial price controls, severely restrict drug choices and, in the case of the VA, include only a handful of the nation’s 60,000 pharmacies in their networks. The draconian steps included in this legislation would significantly undermine the goals of the Office of Personnel Management (OPM).

“OPM can and does periodically audit, review, and change the way it manages FEHBP drug benefits. Policymakers should be wary of this legislation and any potential changes that would disrupt benefits for millions of federal workers, especially when considering that a recent OPM survey found that the overwhelming majority of federal employees are satisfied with their health benefits by an almost 7-to-1 margin.”