Healthcare Leaders Applaud CMS Decision to Table the Proposed Stacking Requirement

Outcome Mitigates the Danger of Exacerbated Data Privacy Concerns and Healthcare Supply Chain Vulnerabilities

WASHINGTON, DC, May 17, 2024 – The Healthcare Leadership Council (HLC), the leading health industry association representing all disciplines of American healthcare, commends the Centers for Medicare and Medicaid Services (CMS) for siding with caution on the “stacking” policy by not finalizing a mandated price adjustment. The harmful requirement originally included in the Medicaid Drug Rebate Program Proposed Rule would have redefined a drug’s best price as the net price of the combined total of rebates associated with a drug across the entire pharmaceutical supply chain.

HLC has criticized the shortsighted proposed mandate to stack drug rebates when calculating Medicaid “best price” as disruptive for patients, pharmacies, payers, and manufacturers. If this misguided required calculation was finalized, entities across the pharmaceutical supply chain would need to create complicated new databases and coordinate meticulously to track transactions to the penny, raising serious health data privacy concerns. Moreover, according to an Avalere analysis commissioned by HLC this requirement could increase Medicaid rebates for certain drugs by 17-21%, affecting 10-35% of their volume. Ultimately, these changes could increase costs for tens of millions of patients at the pharmacy counter.

“HLC has worked closely with healthcare organizations both inside and outside of our membership to prove to CMS that this stacking mandate would create additional burdens on the health data infrastructure and cause dramatic consequences throughout the supply chain,” said Katie Mahoney, HLC’s Executive Vice President and Chief Policy Officer. “This welcomed decision will mitigate significant operational barriers and data privacy concerns created by the “stacking” provision of the Proposed Rule.”

To dissuade CMS from finalizing this stacking requirement as originally included in the Proposal Rule, HLC engaged members of Congress and the Administration, shared Avalere’s analysis with policymakers, submitted comments to CMS, and joined a group letter. After highlighting the cybersecurity and patient safety risks in the proposed policy and repeatedly urging CMS not to finalize this portion of the Proposed Rule, HLC is pleased that CMS declared that the stacking mandate will not be finalized.