The Dallas Morning News

Cloaking lower prices for drugs fought

Pharmacist­s can’t steer patients to use cash instead of insurance

- Robert Pear, The New York Times

WASHINGTON — As consumers face rapidly rising drug costs, states across the country are moving to block “gag clauses” that prohibit pharmacist­s from telling customers that 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. A dozen others are considerin­g legislatio­n to prohibit gag clauses, according to the National Conference of State Legislatur­es.

Sen. Susan Collins, RMaine, 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 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 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 that 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 Menighan, the chief executive of the American Pharmacist­s Associatio­n, said such clauses were “not an outlier,” but instead a relatively common practice. Under many contracts, he said, “the pharmacist cannot volunteer the fact that a medicine is less expensive if you pay the cash price and we don’t run it through your health plan.”

A bipartisan measure that took effect in Connecticu­t this year prohibits the gag clauses.

In North Carolina, a new law says that pharmacist­s “shall have the right” to provide insured customers with informatio­n about their insurance co-payments and less costly alternativ­es.

A new Georgia law says that a pharmacist may not be penalized for disclosing such informatio­n to a customer. Maine has a similar law.

In North Dakota, a new law explicitly bans gag orders.

The lobby for drug benefit companies, the Pharmaceut­ical Care Management Associatio­n, has sued in federal court to block that law.

 ?? Audra Melton/The New York Times ?? At least five states have adopted laws to make sure pharmacist­s can inform patients about less costly ways to obtain their medicines than through insurance.
Audra Melton/The New York Times At least five states have adopted laws to make sure pharmacist­s can inform patients about less costly ways to obtain their medicines than through insurance.

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