Trump administration proposes rules for Medicare plans as it seeks to lower drug prices

Health, Fitness & Food

The Trump administration announced Thursday it plans to target “backdoor rebates” as it seeks to lower drug costs for consumers.

CVS Health and Cigna fell 3 percent, while Cardinal Health slipped 2 percent. Walgreens Boots Alliance and UnitedHealth dipped about 1 percent.

A lobbying group for pharmacy benefit managers, or PBMs, said while it is “encouraged” by proposals that increase competition, it is concerned that eliminating rebates for PBMs may increase costs. J.C. Scott, president and CEO of the Pharmaceutical Care Management Association, said in a statement that this may “force Medicare beneficiaries to pay higher premiums and out-of-pocket expenses, unless there is a viable alternative for PBMs to negotiate on behalf of beneficiaries.”

Industry trade group Pharmaceutical Research and Manufacturers of America, or PhRMA, said it supports the proposal, saying it would “fix the misaligned incentives in the system that currently result in insurers and pharmacy benefit managers (PBMs) favoring medicines with high list prices.”

— CNBC’s Bertha Coombs and Angelica Lavito contributed to this report.

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