The Trump Administration's Drug Pricing Proposals for People With HIV, Explained
Every once in a while, we like to try to explain wonky policy proposals that haven't happened yet but that could be of significance for HIV-positive folks if they do.
You may have heard that health honchos in the Trump administration are trying to go after sky-high drug pricing by making changes to a number of drug sources in America's crazy patchwork health system, among them two programs relied on for meds by many folks with HIV: the 340B Drug Pricing Program and Medicare Part D.
"We don't really know what they want to do yet," stresses HIV and cancer long-term survivor Tim Horn, director of medication access and pricing with NASTAD. The administration has not issued any specific rule changes or guidance on how these programs should be changed. But, says Horn, they've certainly been talking much about doing so for a while now, so it's worth knowing what might happen.
Medicare Part D
This program was passed by Congress in 2003 to let Medicare beneficiaries buy drugs on their plans. You may remember that it was controversial because, heeding the bidding of Big Pharma lobbyists, it did not permit the government to negotiate lower prices with drugmakers.
Part of that law set up certain "protected classes" of medicine that severely limited how much plans could hold back certain drugs -- and HIV care is one of those classes. This means that, when it comes to HIV and other protected classes of health care, Medicare Part D plans have to basically cover all available drug options, leaving all the judgment to doctors and patients, even when those options are the most expensive and, some might argue, comparable to cheaper options. In the case of HIV, for example, this means that Medicare Part D plans must cover single-tablet regimens like Biktarvy (bictegravir/emtricitabine/tenofovir alafenamide) and Genvoya (elvitegravir/cobicistat/emtricitabine/tenofovir alafenamide), making life (and adherence) as easy as possible for patients, even though certain multiple-tablet regimens may be cheaper.
But now the administration is talking about maybe putting some restrictions on those protected classes in Part D, such as making a doctor and patient at least start with a cheaper option and permit them to move on to another only if they can show that the cheaper one failed in some regard. (That's called "step therapy.") Or they might put prior-authorization requirements on protected-class drugs.
As you might imagine, says Horn, the HIV Health Care Access Working Group that he is part of has urged the administration to make sure any changes to drug availability are still strictly based on data related to safety, efficacy, and adherence. And a Feb. 6 press release put out by advocates at a long list of AIDS advocacy groups including AIDS United, the Southern AIDS Coalition, and the Black AIDS Institute read: "recent proposed changes to Medicare Part D are problematic, as they would remove most of the protections that ensure people living with serious conditions, like HIV, can access the treatments they need."
However, says Horn, proving that Trump Administration talk around drug policy is both scary and hopeful in terms of putting pressure on drugmakers to lower prices, talk of Part D changes also includes the threat of banning from formularies (lists of covered drugs) any drug that manufacturers raise the price on beyond the standard rate of inflation. That means that if the consumer price index calls for a maximum 3% yearly hike and a drugmaker hikes their drug price 6% to 9%, the drug could get kicked out of the Part D formulary. That would hurt them -- and therefore incentivize them not to hike drug prices dramatically year after year.
The flip side? "Removing a drug from the formulary, for any reason, can be dangerous to patients," says Horn.
Then, he notes, there's the AIDS Drug Assistance Program (ADAP) -- the federal/state program that gets HIV treatments and some other drugs to people living with HIV who can't get their medications any other way. (For example, people who don't have workplace insurance and still have too much income for Medicaid or to qualify for subsidies to lower the cost of private insurance on the Obamacare exchanges.) "If Part D won't cover a drug," says Horn, "then ADAP is on the hook."
So, as you can see, it's too early to know just how much changes to Part D would help or hurt Part D patients with HIV.
The 340B Program
OK, hang onto your hat as we explain this one. The 340B program, among other things, lets nonprofit community health centers -- which play an increasingly big role in providing primary care for people with HIV -- get pricey drugs for big discounts, at least 23% off the sticker price, passing that savings on to their patients. And every time a drugmaker hikes a drug price beyond the inflation rate, more discount for health centers is tacked on.
But the program still makes insurers pay nearly the full sticker price for the drugs to the health centers. In turn, the health centers can use those extra resources to fund all sorts of important programs -- such as pre-exposure prophylaxis (PrEP) expansion programs. For example, if a health center pays only $200 for a drug that costs $1,000-a-month per patient, it also gets $800 per month from the insurer to use as it pleases. As you might imagine, the program is very popular among health centers for the money they make -- and also among drug makers, who get paid out nearly in full. But the insurers like it much less, because they have to pay full price.
Mainly for this reason, says Horn, "the Trump administration has made it clear that it considers 340B to be problematic, but we've seen nothing specific from them or from Congress on what the future of the program might be." Horn makes one thing clear, though: "Any legislative or administrative change must be approached with a scalpel and not an axe." Also, keep in mind that ADAP programs get these 340B discounts, too -- in their case, directly from drugmakers. "We have to ensure that ADAP's 340B discounts are fully protected," says Horn.
Irony and Uncertainty
So there you have it: Two things that haven't happened yet, but could in the coming year or so. We'll definitely inform you if the plot thickens. If you want to get really into the weeds, check out the website of the Fair Pricing Coalition.
On a final note, Horn points out the irony of the situation: On one hand, in myriad ways, the Trump Administration (and 2017's all-Republican Congress) have been absolutely awful on health coverage, especially for the poor and vulnerable. Let's face it, they tried to take it away. But on the other hand, when it comes to drug pricing in the U.S., which everyone agrees is out of control, "some of the most innovative and provocative ideas are coming out of this administration," says Horn. "I only wish we'd been having these conversations in the previous administration."
"It's too early to say how any of this will play out," he adds. And, certainly, you might have noticed that many things said by this administration are a kind of red meat for Trump's base that, due to both indifference and incompetence, never actually get acted on -- or never make it past Congress.
But Horn warns: "Our health system is so fragmented that even if you make improvements in one system, it could have adverse effects in other parts. This moment is an opportunity for the current Congress to take a clear look at our health care system. if we're really going to consider things like Medicare for all, we have to talk about our overall health expenditures in the U.S., and drug pricing fits into that really squarely."
Tim Murphy has been living with HIV since 2000 and writing about HIV activism, science and treatment since 1994. He writes for and has been a staffer at POZ, and writes for the New York Times, New York Magazine, Out Magazine, The Advocate, Details, and many other publications. He is also the author of the NYC AIDS-era novel Christodora and Correspondents, an epic of family, love and war (Grove Atlantic, May 2019).