Bill Banning ‘Gag Clauses’ Passed by Congress

In an effort to lower prescription drug prices, Congress passed the Patient Right to Know Drug Prices Act on Sept. 26, 2018. The bill will now be passed along to the President, who is expected to sign it into law.

What is the bipartisan bill about?

The bipartisan bill, introduced by Sen. Susan Collins [R-ME] and Sen. Claire McCaskill [D-MO], ensures that pharmacy benefit managers, health insurance issuers, and group health plans are no longer allowed to prohibit pharmacy providers from communicating certain drug pricing information to enrollees. Although a few states have passed similar laws, the bill could provide the same rights to everyone in the U.S. The bill would specifically prohibit a practice, known as gag clauses, which prohibits pharmacists from informing patients that their prescriptions may be cheaper if they pay cash or use discount programs other than insurance.

What is a pharmacy benefit manager?

Pharmacy benefit managers (PBMs) administer the pharmacy benefit portion of a health plan, including, large employers. In addition to processing claims on behalf of the plans, PBMs often establish the preferred drug lists, referred to as formularies, that dictate which drugs are covered under the plan and negotiate drug prices with the retail pharmacies that dispense the drugs to enrollees.

Why pharmacists can’t tell you that $30 prescription could cost only $9

It’s not uncommon for patients to be unaware if a cheaper price for their medication exists outside of their insurance. Currently, some pharmacists can be contractually prohibited from informing patients that they could pay less if they did not purchase the drug through their insurance plan. If this bill is signed into law, that would no longer be the case.

With RxSaver, it is possible the patient could get a lower price for their prescription than with their insurance. In some cases, pharmacists know RxSaver has a lower price, but may not be allowed to inform the consumer of potential savings.

More about the timeline of this bill

Here is a timeline of the Patient Right to Know Drug Prices Act:

March 14, 2018: Senate Bill S.2554, or the Patient Right to Know Drug Prices Act, was introduced in the Senate, by Sen. Susan Collins [R-ME].

July 31, 2018: Patient Right to Know Drug Prices Act reported to the Senate.

Sept 17, 2018: Bill passed the Senate, by a vote of 98-2.

Sept. 17, 2018: Sen. Mike Lee [R-UT] introduced an amendment to the bill that would limit the application of a gag clause to self-insured group health plans. The amendment was not agreed to in the Senate by a Yea-Nay vote of 11-89.

Sept. 25, 2018: The U.S. House of Representatives passed/agreed to the bill.

Ongoing: The bill is currently waiting for the President’s signature.