National Treasury Employees Union supports bill to lower FEHBP drug prices

The National Treasury Employees Union recently came out in support of a proposed bill that would lower the costs of prescription drugs and cut premiums for workers and retirees covered by the Federal Employees Health Benefits Program (FEHBP).

H.R. 2175, the FEHBP Prescription Drug Oversight & Cost Savings Act, was introduced by Rep. Stephen Lynch (D-MA).

FEHBP health plans currently contract directly with pharmacy benefit managers who work as middlemen to negotiate prescription drug prices with drug companies and pharmacies on behalf of individual plans.

NTEU National President Colleen M. Kelley said that the purpose of contracting with PBMs was to control drug costs; however, there is not much evidence supporting the effectiveness of this approach.

“Congressman Lynch’s bill is a step in the right direction to enacting better controls over drug spending in FEHBP, and to reducing costs for federal employees and retirees,” Kelley said.

Lynch´s bill would reform FEHBP drug-pricing and contracting requirements, provide the Office of Personnel Management (OPM) with enhanced oversight and contracting authority, and require pharmacy benefit managers to return any rebates, incentives or discounts from drug manufacturers to FEHBP.

FEHBP can´t purchase drugs off the Federal Supply Schedule, so the program’s prescription costs are 15 percent to 45 percent higher than those for Medicare and federal health care systems run by the Veterans Administration and the Pentagon, Kelley said.

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