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Could retroactive DIR fees become a thing of the past? | American Pharmacists Association

Under CMS proposed rule, price concessions would be reflected at point of sale

APhA and other pharmacy groups hailed a CMS proposed rule that, if finalized, would pass drug price concessions directly to Medicare Advantage (MA) and Part D beneficiaries at the pharmacy counter. The proposed rule would account for pharmacy price concessions, also known as direct and indirect remuneration (DIR) fees, at the point of sale (POS). CMS projects this policy would reduce beneficiary out-of-pocket costs and improve price transparency and market competition under the Part D program.

DIR fees refer to price concessions not reflected at POS for pharmacies participating in Medicare Part D networks. Assessed weeks or months after Part D beneficiaries’ prescriptions are filled, the retroactive fees complicate decisions about staffing and whether to expand or even keep open a business. Pharmacies may not realize until long after a prescription is filled that they didn’t even recoup their costs.

Since beneficiary cost-sharing is based on a drug’s price at POS and PBMs extract retroactive fees because the drug ended up costing less than expected after price concessions are applied, the patient—who has already paid the higher price at the counter—saves nothing. By charging patients the adjusted cost at POS, the proposed rule could help patients stay out of the Medicare donut hole, the point at which they begin paying a much higher portion of their prescription drug costs.

The move would not eliminate DIR fees—it would only end the practice of extracting them retroactively. The proposed rule fits into a larger Trump administration effort to tackle high drug prices.

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Could retroactive DIR fees become a thing of the past? | American Pharmacists Association.