The EACH/PIC Coalition submitted a letter to the Chief of Staff to Speaker Don Scott, urging the Speaker to oppose the substitute to HB483 that would impose price caps on prescription drugs. The letter urged the speaker to focus on patient-centered policies that will lower costs for patients.
The letter stated:
“EACH/PIC is very concerned about proposals like the H.B. 483 substitute that focus only on artificial price caps for prescription drugs, as they entirely miss the root causes of patient hardship.“
“This legislation would set artificial price caps under state-regulated health plans for drugs subject to Medicare Drug Price Negotiation Program. We have met with both the H.B. 483 patron and the Governor’s office, both of whom acknowledge that these price caps could have adverse impacts on patients in Virginia by limiting access to drugs with price caps or increasing the out-of-pocket costs patients must pay.”
“However, the last-minute substitute introduced and passed today does nothing to address these concerns. Contrary to statements by Del. Delaney (the bill patron) during today’s Commerce and Labor hearing, the maximum fair prices (MFPs) set by Medicare are neither “tested” or “proven” to reduce patient costs. Instead, actual data compiled last spring by the Pioneer Institute demonstrate that Medicare Part D enrollees have already seen their out-of-pocket drug costs increase an average of 32 percent for the first set of drugs subject to the new MFPs due to Part D plans promptly shifting MFP drugs to higher cost-sharing tiers even before the caps went into effect January 1st.”
“MFPs and other price caps fail to address the “why” behind drug unaffordability, as they fail to alter plan cost-sharing designs or utilization management controls that create direct barriers to affordable, high quality care. Please see the attached document summarizing the latest results from the EACH/PIC Patient-Reported Affordability and Unaffordability Survey, which demonstrates that affordability is not dictated by the list price of a drug but is instead driven by health insurance barriers, income, and evolving life situations.”
“For these reasons, we would urge the Speaker to oppose the H.B. 483 substitute until the harm/benefit to patients can be fully evaluated and the following questions answered:
1) How will patients see any savings from MFP limits when health insurers can respond to price caps (and lower rebates) by removing those drugs from their formularies or moving them to higher cost-sharing tiers where patients pay higher copay/coinsurance?
2) What authority does the Virginia Insurance Commissioner have to modify cost-sharing/benefit designs used by state-regulated health plans in order to prevent cost-shifting for drugs with price caps? (In most states, insurance regulators can only modify/reject premium increases).“
“EACH/PIC shares the Speaker’s goal of lowering drug costs for patients and applauds Virginia for being out-front on reforms that actually benefit patients, such as banning copay accumulator/diversion programs and reforming many anti-competitive pharmacy benefit manager (PBM) practices. We urge lawmakers to continue their focus on these non-UPL reforms, by passing legislation allowing patients to choose plans with capped copayments (S.B. 161) and strengthen provisions in S.B. 669 that “delink” PBM compensation from the price of the drug. This reform (already enacted in Colorado and by Congress for Medicare Part D) is estimated by the USC Schaeffer Institute to save up to 15 percent in annual net drug spending if implemented nationwide, simply by removing the perverse incentive for PBMs to cover the highest-cost drugs for which they can extract the highest drug rebates.”