The U.S. House this week passed a budget blueprint that will pave the way for a vote on a number of drug pricing measures. 340B providers hope to be spared from Medicaid pharmacy cuts.

House Passes Framework for $3.5T Budget Bill That Will Include Key Drug Pricing Measures

The House of Representatives passed a $3.5 trillion budget framework bill on Tuesday that potentially clears the path for Democrats to make extensive changes to U.S. health care delivery, although the impact on the 340B program remains to be seen.

The 220-212 vote on the budget resolution was strictly along party lines. No Republicans voted to advance the legislation. After the House returns from its August recess, it will vote next on budget reconciliation legislation that incorporates what is referred to as the Build Back Better Act. It is expected to include giving Medicare power to negotiate drug prices and requiring drug manufacturers to pay Medicare a rebate for covered drugs whose prices rise faster than inflation. 340B covered entities are concerned that it might also include Medicaid managed care “spread pricing” language that would have the effect of eliminating entities’ 340B revenue on 340B-purchased drugs billed to Medicaid MCOs.

House Speaker Nancy Pelosi secured the unanimous vote on the budget resolution among her caucus in exchange for completing a vote on a $1 trillion infrastructure bill by Sept. 27. The Senate passed its version of that bill on a bipartisan vote earlier this month.

The forthcoming budget reconciliation bill is almost certainly guaranteed to have no Republican support in either the House or Senate, meaning it would have to pass with Vice President Kamala Harris casting a tiebreaking vote in the Senate.

“We must keep the 51-vote privilege by passing the budget and work with House and Senate Democrats to reach agreement in order for the House to vote on a Build Back Better Act that will pass the Senate,” Pelosi said in a statement.

Democrats have made it clear that health care will be among the priorities in the budget bill when it is finalized. Among the proposals being floated is to expand Medicare to include coverage for dental, vision, and hearing aids, and potentially even lowering the age of eligibility. There is also a push to expand Medicaid eligibility in the dozen states that have yet to do so under the Affordable Care Act.

Earlier this week, U.S. Health and Human Services Secretary Xavier Becerra submitted a drug pricing plan to the White House. The contents have yet to be released to the public and it is unclear if 340B is addressed.

Advocates for the 340B program are concerned that the final bill may contain a “spread pricing” provision requiring Medicaid managed care organizations to reimburse drugs prescribed to enrollees at acquisition cost plus a dispensing fee—a move that would hit covered entities with large numbers of Medicaid patients particularly hard. They also would like to see a better resolution to the Centers for Medicare & Medicaid Services’ proposed rule that would continue the Trump administration’s nearly 30% cut in hospitals’ Medicare Part B reimbursement for 340B-purchased separately payable drugs. The U.S. Supreme Court has agreed to review the legality of the rule during its next session that begins in October.

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