The most-favored nation drug pricing rule is now out. I will have a blog post up later going into greater detail about the rule (here’s a link to the post I wrote when the first draft was released in Oct 2018), but for now, here are a few thoughts. (1/7) https://www.healthaffairs.org/do/10.1377/hblog20181026.360332/full/

First, HHS has created unnecessary legal jeopardy for this rule by trying to push it through as an IFR. As a former health policy official in President Trump’s White House noted earlier, an IFR has “virtually no chance of passing legal muster.” https://twitter.com/brian_blase/status/1329818081875603465 (2/7)

HHS’ justification for skipping the APA’s requirements (pp. 215-18) is basically that high drug prices must be urgently addressed, particularly in light of COVID-19. Given that HHS has waited > 2 years to advance the ANPRM, its own conduct may undermine this argument. (3/7)

Second, it looks as if HHS has jettisoned large parts of the previous ANPRM, particularly the vendor model they had planned to use to implement the program. Individual providers and provider groups will now be much more responsible for the mandatory program. (4/7)

Third, even though it is unlikely to be implemented (due to the above-mentioned procedural problems), this rule is a tremendous rhetorical step forward for drug pricing reform in the US. (5/7) https://twitter.com/larry_levitt/status/1329797441445457920

In short, with this rule, the head of the Republican Party is endorsing the proposition that Americans should not pay higher prices than do the citizens of other countries – and he is willing to endorse adopting European price controls to reduce prices here. (6/7)

More later, once I fully read and process this 258-page rule (linked here). There is a LOT in here – ex. it is projected to lower Medicare Advantage rates under benchmarks, even though it doesn’t apply to MA plans. (7/7) https://innovation.cms.gov/media/document/mfn-ifc-rule