Legislators focus again on ‘ever-growing problem’ of drug costs
Jessica Bartlett | Boston Business Journal | July 14, 2021
State officials say efforts to lower what the state pays for drugs is already saving millions of dollars annually, and in a hearing Tuesday, legislators turned their attention to further reforms of drug pricing and access.
The state’s Joint Committee on Health Care Financing heard testimony Tuesday from dozens during a virtual hearing, reviewing a slate of bills that were aimed at reducing drug costs, increasing transparency, and strengthening drug access.
“Medicine is a key component in increasing health outcomes, extending longevity and improving our quality of life and pharmaceutical companies play a crucial role in the development of those medications,” said State Sen. Cindy Friedman, who co-chairs the Joint Committee on Health Care Financing. “But drug prices continue to soar and life-saving medications are becoming more and more out of reach for far too many patients. We must address this serious and ever-growing problem.”
Measures meant to bring accountability and transparency are already paying dividends within the state’s Medicaid program, MassHealth, according to the state. Since 2019, MassHealth has been negotiating the prices of drugs with manufacturers, under a state program that threatens to hold public hearings and regulatory reviews on drugs deemed too high priced.
Two years after enacting the program, the state’s Office of Health and Human Services told the Business Journal that the program is saving $159 million annually net of rebates. Absent what would normally be the federal match, the state is saving $60 million a year, said HHS.
Without reforms, patients and physicians at the hearing described choosing between suffering and financial solvency. Several tearfully testified about the stress of purchasing insulin. Rosa Bentley, a member of the Mass Senior Action Council, described three senior members who were unable to afford their medications on their fixed income, leaving them to struggle in agony without it.
“All of us tried to put savings away for a rainy day,” Bentley said. “Well, we are well past rain. We are being flooded and we need some help to get through this typhoon of high prescription costs.”
Competing legislation
One proposal under consideration (S.771 and H.729), sponsored by Friedman and State Rep. Christine Barber, would require pharmaceutical companies to notify the state about new drugs and price increases, and allow the Health Policy Commission to assess drug prices and work with manufacturers to reduce costs. The bills would also create a fund to help people pay for medications; institute a pilot program to limit out-of-pocket insulin spending to $25 a month; and require pharmacists to tell a patient if they can save money paying out-of-pocket for a drug instead of paying their insurance co-pay.
The bills would also permit the state’s Center for Health Information and Analysis to review drug costs to better understand drug cost drivers and propose solutions. Both drug manufacturers and pharmacy benefit managers would be required to participate in the state’s annual cost trends hearings.
Drug companies are pushing their own proposals. MassBio testified in support of two bills (H.1254 and S. 736) which would establish transparency rules for manufacturers and pharmacy benefit managers similar to other states, and would require significant price increases to be disclosed through state agencies. State agencies would also be given more oversight over PBMs.
Manufacturers said that insurers are largely to blame for the high prices borne by consumers.
“Insurers believe that their patients need to have so-called ‘skin in the game’ in order to make the right choices about what drugs they’re taking, and out-of-pocket costs are set by insurance. There’s no way around that,” said Zach Stanley, executive vice president of MassBio.
Insurers said manufacturers had to be held to the same transparency and accountability standards already levied on them.
“Legislative proposals that seek to eliminate consumer cost-sharing and take away health plan utilization management tools fail to address the underlying costs of pharmaceutical drugs and will instead remove important tools that ensure patient safety,” said Lora Pellegrini, president and CEO of the Massachusetts Association of Health Plans, in a statement.
Focus on ‘step therapy’ rules
Much of the testimony focused on bills that would reform “step therapy” rules, which requires that patients first try a lower cost drug on an insurer’s coverage list before moving on to a more expensive one.
Two bills (S.756 and H. 1311) sought to put restraints and time limits around the use of step therapy, creating an appeals process to ensure decisions are based on a patient’s broader medical history, not just that with the one insurer. The bill would also allow doctors to override step therapy restrictions when appropriate
Dr. Eric Wong, a neurologist and oncologist at Beth Israel Deaconess Medical Center, described a five-day process trying to get his patient, who had a brain tumor, an injection prescription for her intense migraine. Without the drug, the patient went to the ER twice.
Gary Mendese, director at large for the Mass Academy of Dermatology, described a patient who had psoriatic arthritis and psoriasis on over 80% of his body, so severely that he shed skin every time he blinked. The patient was completely cleared of his symptoms in 12 weeks on a “miracle drug” injection.
Yet when the patient changed jobs and insurance years later, his new insurer required him to try a different course of treatment for six months, leading his symptoms to return, and forcing him to take a leave of absence from work. It was “unethical and unforgivable,” Mendese said.
“I will say that I agree with you that it is immoral, unethical and should be illegal, that when somebody changes their health insurance that they have to start over,” said Sen. Friedman. “That is absolutely not only horrific, but unacceptable on any level that I can’t even begin to think of … I hope that any insurer that’s listening is embarrassed that that is happening under their watch.”
In a statement, MAHP defended the use of step therapy as useful, but said it’s open to reform.
“MAHP supports legislation that includes a transitional period to promote continuity of care and avoid interruptions in drug therapy when a member is using a drug successfully and changes plans,” Pellegrini said. “We look forward to working with the Legislature to ensure the bills include a clear definition of step therapy protocols so that patients can continue to access their medication without interruption or delay in treatment.”