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House OKs S. 2554, a Bill That Would Ban Pharmacy ‘Gag Clauses’

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S. 2554, a bill backed by President Donald Trump that will allow pharmacists to tell patients about the cheapest way to pay for prescription drugs at the counter, won approval in the House of Representatives Tuesday.

The legislation, already passed by the Senate, bars insurers and pharmacy-benefit managers, or PBMs, from prohibiting pharmacists from telling patients they could potentially save money by paying cash instead of an insurance copayment.

The bill was introduced in response to a PBM industry practice called clawbacks. That happens when a patient goes to pick up a drug at the pharmacy and hands over a copayment set by their PBM that’s bigger than the actual cash cost of the drug. The PBM ultimately pockets the difference.

(Related: Blue Cross Executive Backs Ban on Drug Benefits Gag Clauses)

Most patients never realize there’s a cheaper cash price because of clauses in contracts between pharmacies and PBMs that bar the drugstore from telling people there’s a cheaper way to pay. Critics call it a gag clause.

Members of  the House approved S. 2554 by a voice vote. The bill was on the House “suspension calendar.”

What Is a “Suspension Calendar”?

A suspension calendar is a list of popular measures that can be passed quickly, without going through the usual House rules.

What Does S. 2554 Do?

The legislation gives Trump — who is expected to sign the bill after he posted a tweet on Sept. 17 vowing support for it — a victory in his quest to give Americans access to cheaper prescription drugs. He proposed barring gag clauses in May as part of his plan to lower U.S. drug prices.

Several states have already passed legislation to stop the practice. A number of lawsuits have been filed against insurers, alleging that PBMs defrauded consumers and violated insurance laws.

PBMs process prescriptions for insurers and large employers, and also determine which drugs are covered or whether they will carry a copay when the patient picks up the drug. They also bargain with drugmakers for lower prices, excluding some drugs and preferring others in return for discounts.

“Insurance is intended to save consumers money,” Sen. Susan Collins, a Republican from Maine and a bill co-sponsor, said in a statement Tuesday. “Who would think that using your debit card to buy your prescription drugs would be less expensive than using your insurance card? It’s counterintuitive.”

What Other Suspension Calendar Bills Passed?

Members also approved H.R. 6378 by a voice vote.

H.R. 6378 is the “Pandemic and All-Hazards Preparedness and Advancing Innovation Act of 2018″ bill.

H.R. 6378 aims to fund and strengthen programs that could protect the country against influenza and other serious, contagious diseases, such as Ebola.

One provision states that the U.S. Government Accountability Organization (GAO) should do a report on regional preparedness and response efforts. In that provision, drafters suggest that the GAO should seek input from private sector financial institutions along with other parties.

In another section, the bill states that the secretary of the U.S. Department of Health and Human Services should get advice about watching out for contagious diseases and other hazards, and analytical approaches to surveillance, from private entities as well as from public entities.

At several other points, the bill encourages HHS to work with private entities when planning preparedness and response efforts.

Sen. Richard Burr, R-N.C., has introduced an identical bill in the Senate, S. 2852. The Senate Health, Education, Labor and Pensions Committee has jurisdiction over S. 2852.

—With assistance from Anna Edney.

— Read Trump Promises Aggressive Campaign to Cut US Drug Priceson ThinkAdvisor.

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