U.S. Sens. Susan Collins (R-ME) and Bill Cassidy (R-LA) want to help prevent Americans from overpaying for prescriptions and on March 14 led several colleagues in introducing two bipartisan bills that would bring transparency to the retail drug market.
The Patient Right to Know Drug Prices Act, S. 2554, prohibit the use of “pharmacy gag clauses” in health insurance plans that prevent pharmacists from informing customers when a prescription would cost less if they paid out of pocket rather than going through their insurance company, according to a summary provided by Cassidy’s staff.
“Americans have the right to know which payment method — insurance or cash — would provide the most savings when purchasing prescription drugs,” said Sen. Collins, who introduced S. 2554 with Sens. Cassidy, John Barrasso (R-WY), Claire McCaskill (D-MO), and Debbie Stabenow (D-MI) signing on as original cosponsors. “By prohibiting gag clauses, our legislation would take concrete action to lower the cost of prescription drugs, saving consumers money.”
A second bill, the Know the Lowest Price Act, S. 2553, would amend the Social Security Act to establish the same protections for Medicare Advantage and Medicare Part D plans. Sen. Stabenow introduced S. 2553 with Sens. Collins, Cassidy, Barrasso and Ron Wyden (D-OR) being original cosponsors.
“Gag clauses increase drug costs by thwarting market force, forcing patients to pay more,” said Sen. Cassidy, who is a medical doctor. “Eliminating gag clauses lets patients know the true cost of drugs and saves patients money.”
Health insurance plans are supposed to save consumers money, but gag clauses in contracts do the opposite, Collins noted. “Multiple reports have exposed how this egregious practice has harmed consumers, such as one customer who used his insurance to pay $129 for a drug when he could have paid $18 out of pocket,” the senator said.
Of the $330 billion that Americans spent on retail prescriptions in 2016, consumers paid $45 billion out of pocket, while the federal Medicare and Medicaid programs paid $139 billion, according to Cassidy’s staff, who added that prescription drug spending accounted for approximately 10 percent of all health care expenses.
“There is still a lot of work to be done to lower the cost of prescription drugs but our legislation is an important step forward,” said Sen. Stabenow.
S. 2554 has been referred to the Senate Health, Education, Labor, and Pensions Committee, while S. 2553 is now under consideration by the Senate Finance Committee.