Why your pharmacist can’t tell you about lower costs
WASHINGTON — As consumers face rapidly rising drug costs, states across the country are moving to block “gag clauses” that prohibit pharmacists from telling customers they could save money by paying cash for prescription drugs rather than using their health insurance.
Many pharmacists have expressed frustration about such provisions in their contracts with the powerful companies that manage drug benefits for insurers and employers. The clauses force the pharmacists to remain silent as, for example, a consumer pays $125 under her insurance plan for an influenza drug that would have cost $100 if purchased with cash.
Much of the difference often goes to the drug benefit managers.
Federal and state officials say they share the pharmacists’ concerns, and they have started taking action. At least five states have adopted laws to make sure pharmacists can inform patients about less costly ways to obtain their medicines, and at least a dozen others are considering legislation to prohibit gag clauses, according to the National Conference of State Legislatures.
Sen. Susan Collins, R-Maine, said that after meeting recently with a group of pharmacists in her state, she was “outraged” to learn about the gag orders.
“I can’t tell you how frustrated these pharmacists were that they were unable to give that information to their customers, who they knew were struggling to pay a high copay,” Collins said.
Alex M. Azar II, the new secretary of Health and Human Services, who was a top executive at the drugmaker Eli Lilly for nearly 10 years, echoed that concern. “That shouldn’t be happening,” he said.
Pharmacy benefit managers say they hold down costs for consumers by negotiating prices with drug manufacturers and retail drugstores, but their practices have come under intense scrutiny.
The White House Council of Economic Advisers said in a report this month that large pharmacy benefit managers “exercise undue market power” and generate “outsized profits for themselves.”
Steven F. Moore, whose family owns Condo Pharmacy in Plattsburgh, N.Y., said the restrictions on pharmacists’ ability to discuss prices with patients were “incredibly frustrating.”
Moore offered this example of how the pricing works: A consumer filling a prescription for a drug to treat diabetes or high blood pressure may owe $20 if he uses insurance coverage. By contrast, a consumer paying cash might have to pay $8 to $15.
Mark Merritt, the president and chief executive of the Pharmaceutical Care Management Association, which represents benefit managers, said he agreed consumers should pay the lower amount. As for the use of gag clauses, he said: “It’s not condoned by the industry. We don’t defend it. It has occurred on rare occasions, but it’s an outlier practice that we oppose.”
However, Thomas E. Menighan, the chief executive of the American Pharmacists Association, said such clauses were “not an outlier,” but instead a relatively common practice.