This legislation requires hospitals to post their prices so healthcare consumers can shop and compare costs, much like the way they compare costs for every other commodity consumed in their daily lives. The bill also increases oversight and transparency for pharmacy benefit manager (PBM) anti-competitive business practices.
May 23, 2023
The Honorable Cathy McMorris Rodgers
Chair of the Energy & Commerce Committee
2125 Rayburn House Office Building
Washington, DC 20515
The Honorable Frank Pallone
Ranking Member of the Energy & Commerce Committee
2322 Rayburn House Office Building
Washington, DC 20515
Dear Chair Rodgers and Ranking Member Pallone,
On behalf of the 2.1 million members of AMAC, the Association of Mature American Citizens, I am pleased to convey our support for the Transparent PRICE Act, H.R. 3281. AMAC supports the open and bipartisan process the Energy & Commerce Committee has taken to create this legislation that promotes hospital and insurer price transparency and starts reining in the anti-competitive business practices of pharmacy benefit managers (PBMs).
With the increasing price of healthcare in the United States, it is important for patients of all ages to know and understand the costs of their healthcare. AMAC strongly supports and considers the requirement that hospitals make all standard charges for all items and services public through machine-readable files as well as payer-specific negotiated charges, including for cash-paying patients, for at least 300 shoppable services, to be of great importance to our membership. Requiring this transparency will help patients as they seek out affordable options for their healthcare.
These shoppable services, meaning a service that can be scheduled by a healthcare consumer in advance, may include procedures such as joint replacements and other services like physical therapy. Empowering patients with clear hospital pricing will allow them to shop for these procedures and services, much like how they compare prices for any other commodity consumed in their daily lives. Such transparency should also foster competition among hospitals and drive down the cost of these services and procedures, another huge benefit for healthcare consumers.
AMAC, and our members, also support efforts to rein in the anti-competitive business practices of PBMs. These administrative middlemen use business practices, such as spread pricing, where the PBM charges insurers, like Medicare, one price and reimburses the pharmacy a lower price and keeps the remaining payment as profit. This price skimming is on top of administrative fees paid by insurance plans, clawbacks of consumer overpayments, and selling drug utilization data that has allowed PBMs to become a multi-billion industry. Also, AMAC supports the additional oversight requirements that ensure plan sponsors have transparency in how PBMs are managing a plan’s pharmacy benefits. With this increased transparency, more plan sponsors can choose PBMs with lower costs and use a free-market approach when engaging in business with these entities. AMAC applauds the committee for taking the first step in limiting these anti-competitive business practices by banning spread pricing for any outpatient prescription drug charges paid by Medicaid.
AMAC offers our support for H.R. 3281 on behalf of our members and endorses the hard work the Energy & Commerce Committee has done in bringing additional transparency to the complex hospital and PBM systems.
Thank you, Chair Rodgers, and Ranking Member Pallone, for your efforts to reduce the cost of medical services and for helping patients take more control over their healthcare.
Sincerely,
Bob Carlstrom
President
AMAC Action
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