The Massachusetts Medical
Society wishes to be recorded in strong support of Senate bill 760 and House bill 133 which would offer a comprehensive and meaningful approach to the high and rising
costs of prescription drugs that at times impede the ability to provide the
best quality of medical care possible to the residents of Massachusetts.
Prescription drug costs are a
major impediment to patients’ access to medically indicated care, and a high
priority for the Medical Society. The Health Policy Commission’s 2018 Cost
Trends Report showed that, while the state’s Total Health Care Expenditure
growth came in at 1.6%, well under the 3.6% rate set by the Commission, the
growth of spending on prescription drugs remained high, at a 4.1% increase.[1]
Prescription drug costs are one of the major remaining areas of health care
spending in the state that have not yet been curtailed.
This proposed legislation
would address those problems, through several mechanisms. This bill offers the
most comprehensive collection of provisions aimed at increasing transparency of
pharmaceutical manufacturers and pharmacy benefit managers (PBMs) to shine
light on areas of history data opacity in the pharmaceutical manufacturing and
sales continuum such as drug rebates, research and development and marketing
costs, and various rebates and fees in the PBM market. Massachusetts has benefited
from unprecedented levels of transparency for health insurers, hospitals and physician
organizations through many aspects of Chapter 224. This bill would provide analogous
levels of transparency to the one areas of the market that been driving the
most significant cost increases over the past several years.
MMS also supports authorizing
the HPC to set upper payment limits that insurers can pay for drugs that have
been deemed by the state after an extensive process to be “unreasonably
high-priced” and without justification. Drug costs need serious action, and
this proposal created a balanced, meaningful intervention for the most concerning
cases.
The MassHealth program needs
real tools to combat its rising pharmacy costs. MassHealth prescription drug
spending has nearly doubled from ~$1.1B to ~$1.9B since 2012, twice the growth
vs. other MassHealth spending. New York state’s Medicaid program saw
significant savings from a program similar to the one proposed in this legislation
to allow for negotiation of supplemental rebates. This proposal could help
further constrain spending for the MassHealth program, which accounts for 40%
of the state budget. Cost savings could allow the state to further expand
access to health care, or to fund other proposals such as education or transportation.
The MMS has strong policy in
support of this proposed legislation. MMS policy states, “The MMS supports
efforts to decrease the costs of medications for our patients. Our policy is
particularly strong on transparency of drug costs with respect to
direct-to-consumer advertising:
“The MMS in its effort to
reduce unnecessary medication costs for patients will advocate that all direct-to-consumer
advertising expenses by pharmaceutical companies be reported publicly based on
uniform accounting procedures, and advocate that such costs shall not be passed
on to the public, thereby eliminating increased pricing to the consumer.”
“The MMS will collaborate
with other state and national medical societies to request that all relevant
government agencies require reporting for all direct-to-consumer advertising
expenses, and review the pharmaceutical companies' drug development costs and
advocate that the direct-to-consumer advertising expenditures are not included
in the pricing structure of any pharmaceuticals.”
The MMS urges the Joint Committee
on Health Care Financing to support the above referenced legislation, to ensure
that citizens of the Commonwealth receive continued access to the prescription
drugs required to maintain their health and safety.
[1]
https://www.mass.gov/files/documents/2019/02/20/2018%20Cost%20Trends%20Report.pdf
