Gun Violence Reduction Law Further Extends Moratorium on Trump-Era Rebate Rule

We have blogged before (for example, here and here) on amendments to the Federal health care program antikickback law safe harbor regulations that were finalized by the Trump Department of Health and Human Services in November 2020.  If and when implemented, the amendments will likely force Medicare Part D plans and their PBMs to pass drug manufacturer rebates through to pharmacies to reduce out-of-pocket expenses of Part D enrollees, which would be a dramatic change from current practice.  The original effective date of January 29, 2021 was first extended until January 1, 2023 due to litigation.  However, because the rule was projected to cost the federal government about $196 billion over ten years, further moratoria on implementation of this rule have become a handy way for Congress to pay for other legislative priorities.

For example, in the service of highway and other infrastructure enhancements, a moratorium on the rule was imposed until January 1, 2026 under the 2021 Infrastructure and Investment and Jobs Act.  The Build Back Better Act, had it passed the Senate, would have thrown the rule under the bus altogether in order to help pay for the many costs to the federal government in that bill.

A little-noticed section (13101) of the Bipartisan Safer Communities Act, signed by the President on Saturday, continues the pattern by extending the moratorium on the rebate rule one more year until January 1, 2027, this time to help pay costs of implementing the gun violence reduction measures in that legislation.

Thus, Congress has discovered in the rebate rule a use that was not originally intended by HHS.  This method of financing expenses may not work for the typical family trying to make ends meet, but Congress is undaunted.  This blogger wonders whether we might continue to see an additional moratorium on the rebate rule in every major piece of federal legislation until the rebate rule is delayed well into the 2050s.