January 3, 2018

Healthcare Cabinet lays out drug cost strategies

ccPixs.com | Flickr Creative Commons
ccPixs.com | Flickr Creative Commons

The state's Healthcare Cabinet has issued a draft list of legislative and other priorities aimed at tackling rising prescription drug costs, which affect government, consumers and companies alike.

The government-industry group, which advises Gov. Dannel P. Malloy and Lt. Gov. Nancy Wyman (who chairs the cabinet) on healthcare reform and system development, said it wants to better understand drug price trends and find ways for the state to reduce its pharmaceutical spending.

Its draft report, which will undergo a public comment period leading up to a Jan. 16 cabinet meeting, has numerous recommendations, many of which would require legislative approvals, including:

  • Create a Drug Review Board to regulate cost increases, similar to how the Public Utilities Regulatory Authority decides on electric and natural gas rates. The Attorney General would have the power to enforce the review board findings through modified price-gouging statutes.

  • Require pharmacy benefit managers -- middlemen who manage drug benefits for health plans -- to disclose more information about their price calculations and their charitable contributions to patient advocacy nonprofits and assume fiduciary responsibility to their clients.

  • Require the Insurance Department to collect additional information from insurers during the annual rate filing process to glean to what effect drug prices have on rising premiums.

  • Mandate that coinsurance and deductible amounts paid by consumers for drugs be based on the net price after rebates, instead of the price before rebates. Kaiser Health News reported recently that consumers rarely benefit from rebates.

  • Require insurers to provide online calculators that reveal the price of drugs covered by coinsurance, similar to online tools that show cost information for medical procedures.

  • Consider a wholesale importation program for prescription drugs from Canada, which pays approximately half of what the U.S. pays for drugs, according to the cabinet's draft report.

The report and information about public comments can be viewed here.

The cabinet said it may alter some of the recommendations after its meeting later this month.

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