Aug 16, 2021 - Health

Health care industry sues over another transparency rule

Illustration of a gavel made of a pill bottle, touching a gavel rest made of a white pill.

Illustration: Shoshana Gordon/Axios

The U.S. Chamber of Commerce and the Pharmaceutical Care Management Association are suing the federal government to halt a regulation that would force health insurers and employers to reveal the prices of services and drugs.

Why it matters: The health care industry claims it is in favor of price transparency, but in reality, the industry has fought attempts to unlock the black box of prices.

Where it stands: The regulation in question, finalized by the Trump administration last November, requires plans and companies that are self-insured to make prices and out-of-pocket costs available for 500 items by Jan. 1, 2023.

  • That information has to be available for all health care services and products by Jan. 1, 2024.

This rule is similar to a separate rule by the Trump administration that required hospitals to post their negotiated prices.

What they're saying: The Chamber and PCMA, which lobbies on behalf of pharmacy benefit managers, argue the rule is illegal for two main reasons:

  • The proposed rule never mentioned "historical net prices" as a required item to disclose, but the final rule did. The groups argue this violated procedural law, and they say this data has "legal protections against disclosure as proprietary business information and trade secrets."
  • The regulation also requires pricing data to be posted in "machine-readable files," but the groups say that goes against the federal law that pricing data be displayed in "plain language."

Between the lines: Requiring disclosure of net drug prices is especially important, because net drug prices are highly guarded secrets.

  • For as much as pharmaceutical companies and PBMs like to blame each other over high drug prices, they are on the same page here and do not want net prices publicized. (PhRMA and the Chamber of Commerce are in lockstep on almost all issues.)

The bottom line: Health care companies only want transparency that doesn't disrupt their businesses.

  • The Chamber has lamented that "health care pricing is a complete mystery," and PCMA advocates for "the right transparency."
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