WASHINGTON — The Trump administration’s newest drug pricing idea suggests change on a massive scale: it pitches a wholesale transformation of the way millions of Americans pay for drugs, one that could have a ripple effect into nearly every corner of the country’s health care system.
The proposal would effectively eliminate the rebates that drug makers pay insurance companies in Medicare and parts of Medicaid. Manufacturers pay these rebates to secure good placement on an insurer’s formulary, which makes it easier for patients to get those drugs and harder for them to get competitors. The regulation, if finalized, would make using rebates a violation of federal bribery law. Instead, drug makers could offer discounts that are more directly passed onto consumers.