Drug Makers Push for Pay Delay in Part D Discounts

At a public meeting in Baltimore, Maryland earlier this week, drug manufacturers pressed federal officials to lengthen the payment period for Part D prescription discounts.

As the first $250 rebate checks are being prepared for delivery to senior citizens who hit the so-called “doughnut hole,” drug makers are pushing federal officials for another round of revisions to the Medicare Part D drug rebate program.

First and foremost, drug makers want more time to pay the 50% discount for drugs that fall into the Medicare Part D coverage gap, Inside Health Policy reported yesterday. The discount requirement, which was included in the health care reform bill as a way to help close the doughnut hole over time, will go into effect in 2011. As of now, manufacturers will be required to pay the discounts within 15 days.

In a conference in Baltimore, Maryland on Tuesday, manufacturers criticized the Centers for Medicare & Medicaid Services (CMS) for the 15-day payment period, which differs substantially from the payment periods specified by Medicaid and Tricare. The latter plans give manufacturers 60 days or more to make required payments.

An attorney who spoke on behalf of manufacturers and health plans said 15 days is not nearly enough time, and that the new policy is doomed to backfire. Sara Froelich, vice president of federal operations for Genzyme, said a 60-day period will result in fewer mistakes, and ultimately, fewer appeals, according to the Inside Health Policy report.

A representative from Merck who was present at the meeting agreed, calling the 15-day period “overly burdensome,” especially for smaller drug makers.

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