Rep. Stephen Lynch, D-Mass., this week introduced legislation that would give the Office of Personnel Management more oversight of companies that negotiate prescription drugs prices for federal employees.

Pharmacy benefit managers (PBMs) negotiate with pharmaceutical companies on behalf of insurance providers in the Federal Employees Health Benefits Program. OPM currently has little oversight over them and cannot ensure that any rebates PBMs receive from pharmaceutical companies — which can amount to as much as 50 percent of the drugs' retail price — are passed along as savings to health plan enrollees.

HR 4489, the FEHBP Prescription Drug Integrity, Transparency and Cost Savings Act, would require PBMs to return to the government 99 percent of all rebates, market share incentives and other savings they receive from manufacturers for federal employees' drugs.

The bill would place new transparency requirements on PBMs and cap drug prices to make sure the government doesn't pay more than the nationwide average. PBMs would also be prevented from switching federal employees' drugs to cheaper alternatives without their physicians' prior approval.