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The Trump administration on Thursday backed off a controversial Medicare drug pricing proposal that would have allowed insurers to exclude certain drugs if prices rise faster than inflation. In a final rule, the administration said it was leaving in place the current policy about Medicare’s “protected classes” of drugs. (Weixel, 5/16)

The initial proposal, which would have allowed private Medicare plans to refuse to pay for certain drugs for chronic conditions that spiked in price, was met with widespread criticism almost as soon as it was proposed last November. The Trump administration had suggested the change would help lower drug prices by giving private Medicare plans more leverage over high-cost drugs. But patient advocates and drug makers said it would jeopardize patient care in life-threatening situations. (Florko, 5/16)

But pharmacy groups were not happy with the decision by the CMS to back off on changes to such price concessions, which are called direct to renumeration fees. Pharmacists charge that pharmacy benefit managers and insurers often assign an expensive copay for a drug well beyond its actual price. The PBM or insurer then claws back the extra money, pharmacy groups charge. "In its proposed rule the administration cited the recent 45,000% increase in pharmacy price concessions, an increase that is unsustainable," according to a statement from the National Community Pharmacists Association and National Association of Chain Drug Stores. "Pharmacies are in a tenuous situation, and our organizations are exploring all options to accomplish desperately needed reforms to pharmacy DIR." (King, 5/16)

With just four days left in the legislative session, Minnesota lawmakers struck an agreement to license and regulate pharmacy benefit managers. Will that impact what you pay for your medicine? Pharmacy benefit managers, or PBMs, negotiate with drug makers on behalf of insurance plans. They manage drug pricing and decide which medications are covered by insurance companies. (Faircloth, 5/16)

At a press conference at Laguna Honda Hospital in San Francisco on Thursday, Mayor London Breed announced that San Francisco, Alameda and Santa Clara counties would join Gov. Gavin Newsom's plan to collectively bargain with pharmaceutical companies for lower drug prices. ...Since being sworn in, Gov. Newsom has made expanding health coverage in the state a key part of his agenda. (Wiley, 5/16)