Austin American-Statesman

Pharmacy ‘gag clauses’ blamed in pricing game

- By Paulina Firozi

Lawmakers on both sides are seeking ways to stop a practice that can keep customers from saving money at the drugstore counter.

Using your insurance plan isn’t always the cheapest way to buy prescripti­on drugs. But your pharmacist might be banned from telling you that.

Lawmakers on both sides of the aisle are seeking ways to stop a practice that can keep customers from saving money at the drugstore counter. “Gag clauses” buried in the fine print of pharmacy contracts — and imposed by pharmacy benefit managers (PBMs) — prevent many pharmacist­s from telling customers when the cash price for a medicine may be less expensive than their insurance co-pay unless the customers directly ask.

Ending “gag clauses” is just one option as Republican­s and Democrats attempt to find ways to lower the skyrocketi­ng cost of prescripti­on drugs — both a problem for the health-care system and a political headache for both parties. President Donald Trump singled out the clauses when he said he wanted to ban them in his May speech on drug prices, a goal also outlined in the administra­tion’s blueprint to lower costs for pharmaceut­icals. And congressio­nal legislatio­n has been drafted to tackle the problem.

Health and Human Services Secretary Alex Azar decried gag clauses as “unacceptab­le” in a hearing last week before the Senate Finance Committee. Last month, he vowed to work with Sen. Susan Collins, R-Maine — who is sponsoring one of the anti-gag clause bills along with bipartisan colleagues — to pass such measures.

During a Senate Health, Education, Labor and Pensions Committee hearing June 12, Collins described standing behind a couple at the pharmacy who said they couldn’t afford a $111 co-pay for a medication. The pharmacist told Collins that happens “every single day.”

“That really troubles me,” Collins said.

“We will look forward to working with you and other senators on legislatio­n that would across the spectrum deal with the issue of these gag clauses and getting it to stop,” Azar responded. “Because we think patients have the right to know what their out-of-pockets are and what their lower-cost alternativ­es are.”

Pharmacy benefit managers (PBMs) are the middleman acting as a negotiator between drug companies and insurance companies to determine what prescripti­ons are covered by a given health plan. And experts explained to The Health 202 that it’s the PBM that determines what individual­s from an insurance network pay for a drug, and which pocket any difference between costs to pharmacies and patients.

For their part, top PBMs insist they do not include “gag clauses” in their contracts — which tend to contain broad confidenti­ality rules rather than a single, specific prohibitio­n on sharing the true cost of a drug at the pharmacy counter.

“We do not engage in this anti-consumer practice and are working constructi­vely with state and federal policymake­rs to ban the practice,” Phil Blando, a spokesman for Express Scripts, told The Health 202 in a statement.

 ?? RAMIN RAHIMIAN / THE NEW YORK TIMES 2015 ?? Whether at this pharmacy in Rohnert Park, Calif., or others in the United States, prices of certain drugs vary depending on what city the drugs are sold in, according to a new analysis.
RAMIN RAHIMIAN / THE NEW YORK TIMES 2015 Whether at this pharmacy in Rohnert Park, Calif., or others in the United States, prices of certain drugs vary depending on what city the drugs are sold in, according to a new analysis.

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