CT, Mass. work together for medicine price limits

Connecticut and Massachusetts worked together early in the coronavirus pandemic to institute similar restrictions to keep their residents safe, and later to reopen their economies and lift stay-at-home orders.

Now, Govs. Ned Lamont and Charlie Baker are hoping to lead the country in addressing one of the major underlying costs of health care: prescription drug prices.

The governors hosted a joint news conference Tuesday to discuss similar legislation they have proposed in their states, which, they said, would protect consumers and hold drug manufacturers accountable.

Lamont’s two-year budget plan proposes capping annual increases in the cost of prescription drugs. Under the governor’s proposal, yearly hikes would be limited to the rate of inflation plus 2 percent.

Drug manufacturers that exceed that amount would be fined, and the fine money would in turn be used to support subsidies for health coverage.

“We hope that companies will limit their price increases under the legislation. We’re hopeful that that’s the path that’s taken rather than the collection of penalties,” said Vicki Veltri, executive director of Connecticut’s Office of Health Strategy.

The state Department of Revenue Services would collect the penalties and deposit the money in the Covered Connecticut Program, a proposal by the governor to help people access insurance in a more affordable manner, Veltri said.

Most of the proposals for health care

“We wanted to put in place a mechanism where we did not discourage innovation in any way, but also wanted to make sure there are no surprises.” Gov. Ned Lamont

reform coming out of Congress and state legislatures deal with the question of “who pays and how we can provide more subsidies on the exchange,” Lamont said.

Whereas he and Baker are seeking to address how to “bring down the high costs of health care for individuals, working families and state budgets, to be blunt about it.”

One of the big drivers of those high costs is pharmaceutical drug prices, which represent about 20 percent of overall health care expenses, Lamont said.

“We wanted to put in place a mechanism where we did not discourage innovation in any way, but also wanted to make sure there are no surprises,” he said.

Paige Mahaney, who leads Boehringer Ingelheim’s research team in Connecticut,

said Lamont’s proposal “oversimplifies an extremely complicated health care payment model, given “the price set by a pharmaceutical company has little to do with the amount paid by a patient at the pharmacy counter, which is typically controlled by the patient’s health insurance plan.”