Conn., Mass. push for prescription drug price control
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 that 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 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% 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 in a recent op-ed that the governor’s proposal would “impede” scientific advancement given the pharmaceutical company reinvests more than 20 percent of its net sales into research and development.
Lamont’s proposal also “oversimplifies an extremely complicated health care payment model,” Mahaney said, 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.”
Pharmacy benefit managers and others between the manufacturer and pharmacy counter also impact costs, Mahaney said.
“This is not to start blaming others in the health care ecosystem but to highlight the reality of an overly complex pricing system that cannot be fixed with a single bill from a single state,” she said.
When asked about her comments, Lamont pushed back at the notion that his bill would stimy scientific advancement, saying “all those innovation investment costs are baked into the original price of the drug.”
“All we’re doing is capping the increase going forward so Boehringer and all the other great pharmaceutical companies won’t have less incentive to go forward and continue to make those investments.”
Veltri added that research shows the list price of drugs set by manufacturers does, in fact, affect the acquisition costs by pharmacies and the price paid by consumers at the counter.
The proposals by Baker and Lamont, if passed, are intended to provide predictability and relief to people like Karolina Chorvath, of Massachusetts, and Jay Gironimi, of Connecticut, who joined the governors at their press conference to share their experiences living with medical conditions and battling skyrocketing prices for prescription medication they need to survive.
Gironimi, who has cystic fibrosis, said he’s spent his “entire adult life” trying to find ways to afford the ten medications he’s currently on. While his current employer provides him with health insurance that helps pay for those costly prescriptions, “I know that can change at any minute,” he said.
“I shouldn’t have to constantly live in fear of what would happen if I had to face the full price of my medicine. I shouldn’t be forced to decide between financial ruin and detrimental health outcomes,” Gironimi said. “It’s why we need reforms now.”
The proposals by Baker and Lamont “could quite literally make me breathe easier,” he said.
Shortly after he was elected governor, Lamont said he received a call from Baker who said “Congratulations, what are we going to do about drug pricing together?”
“Together we can make a difference and show the rest of the country how we can make drug pricing a lot more predictable for some folks who need it,” Lamont said Tuesday.