Legislation seeks to lower FEHB drug costs

A House member sponsored a bill that would cut the costs of prescription drugs to help lower premiums for federal employees and retirees.

The FEHBP Prescription Drug Oversight & Cost Savings Act (H.R. 2175), introduced April 30 by Rep. Stephen Lynch (D-Mass.), would reform current Federal Employees Health Benefits program drug pricing and contracting requirements. The bill would compel pharmacy benefits managers—the firms that negotiate prices with drug companies and pharmacies on behalf of FEHB plans—to pass through to FEHB any rebates, incentives or discounts they receive from drug manufacturers.

The bill also would expand the Office of Personnel Management's oversight and contracting authority.

National Treasury Employees Union President Colleen Kelley, whose union supports the bill, maintains that the program's current system of using PBMs does not appear to be controlling drug costs.

Kelley also said FEHB's prescription costs remain 15 percent to 45 percent higher than those of Medicare and the healthcare systems run by Department of Veterans Affairs and the Defense Department because FEHB is not permitted to purchase drugs off the Federal Supply Schedule.

“Congressman Lynch’s bill is a step in the right direction," she said.