Free Daily Headlines :

  • COVID-19
  • Vaccine Info
  • Money
  • Politics
  • Education
  • Health
  • Justice
  • More
    • Environment
    • Economic Development
    • Gaming
    • Investigations
    • Social Services
    • TRANSPORTATION
  • Opinion
    • CT Viewpoints
    • CT Artpoints
DONATE
Reflecting Connecticut’s Reality.
    COVID-19
    Vaccine Info
    Money
    Politics
    Education
    Health
    Justice
    More
    Environment
    Economic Development
    Gaming
    Investigations
    Social Services
    TRANSPORTATION
    Opinion
    CT Viewpoints
    CT Artpoints

LET�S GET SOCIAL

Show your love for great stories and out standing journalism

House unanimously passes bill to shine light on drug industry

  • Health
  • by Mackenzie Rigg
  • May 4, 2018
  • View as "Clean Read" "Exit Clean Read"

Claude Albert :: CTMirror.org

Rep. Sean Scanlon, D-Guilford, introduces the drug-cost transparency bill.

The state House of Representatives unanimously approved a comprehensive bill that aims to shed light on the murky prescription drug industry, which state officials say is a necessary first step to lowering expensive drug costs.

The House voted 149 to 0, with one lawmaker absent. The bill now goes to the Senate.

“There is no denying that the cost of drugs is increasing. It’s something we hear anecdotally. It’s something we’ve seen data on. But few people have answers … as to why that’s actually happening,” Rep. Sean Scanlon, D-Guilford, House chair of the Insurance and Real Estate Committee, said during the debate. “Our goal in this bill is quite simple: It’s to try to get some more information that is not currently available to the general public so that we can really understand what is driving these costs and then ultimately, from that understanding, hopefully be able to work together in a bipartisan way to reduce the cost of prescription drugs.”

This bill, which goes into effect on Jan. 1 , 2020, requires many industry players to disclose a wide range of information to the state. This includes drug companies, health insurers, and lesser-known entities called pharmacy benefit managers, known as PBMs, which manage drug benefits for insurers.

  • Drug companies will have justify increases when a drug’s price jumps more than 20 percent in one year or 50 percent over three years to the new Office of Health Strategy (OHS). 
  • Drug companies also will have to report information about drugs going through the U.S. Food and Drug Administration’s approval pipeline, such as the estimated year that the drug will enter the market. 
  • Insurance companies, when filing rate requests for their health plans each spring, will have to tell the state Insurance Department the 25 drugs with the highest cost to the plan; the 25 drugs with the greatest year-over-year price increases; the 25 drugs most frequently prescribed; the premium growth that is attributable to prescription drugs; and more. 
  • PBMs, which negotiate with drug companies for rebates on prescriptions, will have to report to the insurance department how much they collect in rebates and how much of that they keep. The department will then aggregate that data and find a way to publicly disseminate it, while still protecting proprietary information, such as companies’ names and specific drugs that receive rebates.
  • Insurers will be required to report to the Insurance Department whether they use the rebates to offset premiums, which they typically do, or pass the money down to residents at the pharmacy counter. The information would be published annually by the insurance department.

In return for the rebates that PBMs receive from manufacturers, the companies’ drugs are included on the insurers’ formularies, the lists of drugs the insurance companies will cover.

The rebates generally are offered on drugs where there is competition and not on generic drugs, where price inflation has been less. PBMs keep some of the rebate money and pass the rest directly to the insurers, which typically use the revenue to offset the cost of premiums for customers.

The finger-pointing over drug prices has begun to focus more on PBMs because these companies don’t always disclose the full rebate they get from the drug companies, leading to claims that PBMs could be passing on more savings to patients.

The Pharmaceutical Care Management Association, which represents PBMs, issued a statement reiterating their concerns with the bill, even with the new proprietary protections.

“While PBMs support policies that empower payers and consumers to make informed health care purchasing decisions, we oppose so-called ‘transparency’ proposals that would give drugmakers access to competitive information that would empower them to charge higher prices,” the statement said.

Rep. Rob Sampson, R-Wolcott, ranking member on the insurance committee, said at the beginning of the debate that he supported the bill but had concerns.

“Health care is a difficult thing obviously, much like utilities, these are things that people need to have affordable access to,” Sampson said.

“What saves the bill,” Sampson said, is that the information that the drug companies are required to report to the state already is public information given to the federal government.

“Really for me that’s what saves the bill from going too far,” he said. 

Claude Albert :: CTMirror.org

Rep. Rob Sampson, R-Wolcott, questions Rep. Sean Scanlon, D-Guilford, about the bill.

The Connecticut Association of Health Plans released a statement on Thursday that said: “While we still find some elements of the bill concerning, we appreciate that issues we raised were acknowledged and hope to work with the legislature in the future to address the unit costs of drugs, which we believe to be among the biggest price drivers in the market.” The unit cost of drugs refers to the manufacturers’ prices.

The bill would cost the state about $275,000 in fiscal year 2020 for additional staff in the state Insurance Department and Office of Health Strategy, as well as consulting services for that year. In following years, it would cost about $300,000 for the staffers, according to the legislature’s Office of Fiscal Analysis.

Connecticut officials aren’t the only ones seeking answers from the drug industry. Prescription drug affordability has drawn intense scrutiny the past few years as retail drug spending has risen at the fastest pace in more than a decade — growing 12.4 percent in 2014 and 9 percent in 2015 before slowing to an estimated 5 percent increase in 2016, according to a Congressional Research Service report.

Rules on rebates altered

The approved bill differs from the proposal that was voted out of the legislature’s insurance committee. Most notably it doesn’t include a requirement that the majority of rebates from drug companies be passed down to consumers when they buy drugs at pharmacies.

“I wish this bill could have done more, but to accomplish this in a short session when bills like this don’t pass in regular sessions is a big win for consumers, and I intend to keep going on this issue next year,” Scanlon said.

The provision for direct rebates to consumers was challenged by the insurance department and Connecticut Association of Health Plans, which argued it would cause premiums to increase.

Caitlin Carroll, spokeswoman for PhRMA, which represents the pharmaceutical industry, said the organization was disappointed that the final version didn’t include the direct-to-consumer rebates.

“Making sure that patients who share the cost of their prescription medicines also share the savings is one of the most important things we can do to provide relief for patients facing higher out-of-pocket costs at the pharmacy counter,” Carroll said.

Mackenzie Rigg :: CTMirror.org

Comptroller Kevin Lembo.

Comptroller Kevin Lembo, who was one of the key proponents of the bill, also said he was disappointed, though he said passage still was an “extraordinary victory for Connecticut patients.

“From here, the fight must continue to ensure that patients are not paying outrageous prices at the counter, while powerful corporations thrive on big discounts without sharing financial relief,” Lembo said.

“Some states have taken the next step,” he said. “And the next step is to examine the possibility of drug review boards…”

A drug review board was one of the top recommendations of a February report released by the governor’s Health Care Cabinet that examined drug costs.

According to the report, the drug review board would investigate drug pricing decisions by manufacturers and whether they are justified by market norms and clinical value. If deemed unjustified, the state attorney general could be asked to pursue an unfair trade practice violation against a manufacturer.

Sign up for CT Mirror's free daily news summary.

Free to Read. Not Free to Produce.

The Connecticut Mirror is a nonprofit newsroom. 90% of our revenue comes from people like you. If you value our reporting please consider making a donation. You'll enjoy reading CT Mirror even more knowing you helped make it happen.

YES, I'LL DONATE TODAY

ABOUT THE AUTHOR

Mackenzie Rigg

SEE WHAT READERS SAID

RELATED STORIES
Medical providers are taking nature therapy seriously
by Jenifer Frank | C-HIT.ORG

In a time of social isolation and staying home, sometimes a walk in the park is the best medicine.

Have a case of a COVID variant? No one is going to tell you
by Christina Jewett and JoNel Aleccia | Kaiser Health News and Rachana Pradhan

Federal rules around who can be told about the variant cases are confusing, and tests have not been approved.

CT teachers are expected to get vaccinated for COVID at local clinics, but other options could cause problems
by Dave Altimari

School employees could end up on two lists, which means some vaccine might go to waste, officials said.

Grocery store workers ‘disgusted’ with Lamont’s new COVID-19 vaccine policy
by Keith M. Phaneuf

Grocery store workers are frustrated with Gov. Ned Lamont, who is no longer prioritizing them in the coronavirus vaccination schedule.

Breaking with national recommendations, Lamont says Connecticut’s vaccine rollout will now be prioritized by age
by Jenna Carlesso and Keith M. Phaneuf

People aged 55 to 64 will be next in line for the vaccine.

Support Our Work

Show your love for great stories and outstanding journalism.

$
Select One
  • Monthly
  • Yearly
  • Once
Artpoint painter
CT ViewpointsCT Artpoints
Opinion Fitness is part of Connecticut’s COVID solution
by David Humphrey

Based on what we now know about infection rates and transmission, it is more apparent than ever before that gyms, fitness centers, and the physical and mental health benefits of exercise are essential to help our state get through the months ahead.

Opinion Connecticut can’t afford state government-run health insurance
by Mike Licamele

As much as I support strengthening and improving healthcare, I do not believe SB 842 is the way to do that. Instead of trying to force Connecticut residents into a new, government-controlled healthcare system, lawmakers should focus on improving our existing one by building on what’s working and continuing to address lowering costs, not raising taxes

Opinion Disabled, marginalized, stalled and walled
by Doris Maldonado

As a bilingual health information specialist for PATH P2P Family Voices CT and National Family Voices Cultural Responsiveness Telehealth Team, I offer more than professional expertise as well as despair for the marginalized within marginalized communities. I am a Latina with disabilities, adoptive mother of 17-year-old twins with special needs and a thriving toddler.

Opinion The marijuana legalization debate must be based on facts
by Will Jones III

In response to my earlier piece on why Connecticut lawmakers should reject marijuana commercialization,  Brendan Ruberry wrote a rebuttal that, on its face seems scathing, but to be clear, the attempted rebuttal falls flat and well off the mark.

Artwork Grand guidance
by Anne:Gogh

In a world of systemic oppression aimed towards those of darker skintones – representation matters. We are more than our equity elusive environments, more than numbers in a prison and much more than victims of societal dispositions. This piece depicts a melanated young man draped in a cape ascending high above multiple forms of oppression. […]

Artwork Shea
by Anthony Valentine

Shea is a story about race and social inequalities that plague America. It is a narrative that prompts the question, “Do you know what it’s like to wake up in new skin?”

Artwork The Declaration of Human Rights
by Andres Chaparro

Through my artwork I strive to create an example of ideas that reflect my desire to raise social consciousness, and cultural awareness. Jazz music is the catalyst to all my work, and plays a major influence in each piece of work.”

Artwork ‘A thing of beauty. Destroy it forever’
by Richard DiCarlo | Derby

During times like these it’s often fun to revisit something familiar and approach things with a different slant. I have been taking some Pop culture and Art masterpieces and applying the vintage 1960’s and 70’s classic figures (Fisher Price, little people) to the make an amusing pieces. Here is my homage to Fisher -Price, Yellow […]

Twitter Feed
A Twitter List by CTMirror

Engage

  • Reflections Tickets & Sponsorships
  • Events
  • Donate
  • Newsletter Sign-Up
  • Submit to Viewpoints
  • Submit to ArtPoints
  • Economic Indicator Dashboard
  • Speaking Engagements
  • Commenting Guidelines
  • Legal Notices
  • Contact Us

About

  • About CT Mirror
  • Announcements
  • Board
  • Staff
  • Sponsors and Funders
  • Donors
  • Friends of CT Mirror
  • History
  • Financial
  • Policies
  • Strategic Plan

Opportunity

  • Advertising and Sponsorship
  • Speaking Engagements
  • Use of Photography
  • Work for Us

Go Deeper

  • Steady Habits Podcast
  • Economic Indicator Dashboard
  • Five Things

The Connecticut News Project, Inc. 1049 Asylum Avenue, Hartford, CT 06105. Phone: 860-218-6380

© Copyright 2021, The Connecticut News Project. All Rights Reserved. Website by Web Publisher PRO