Health officials ambivalent on universal drug pricing

MONTPELIER — Health care officials oppose the idea of creating a universal pricing model for prescription drugs.

On Wednesday, the Senate Finance Committee took testimony on a bill that would create a single list of the costs a patient would face when receiving a prescription drug, whether the patient is enrolled with Medicare and Medicaid, or with a private provider.

As initially drafted by Sen. Kevin Mullin, R-Rutland, S.216 proposed to allow a person who is shopping for health care coverage to know how much the out-of-pocket expense will be for a prescription drug.

However, late last week, the bill was amended in committee to call for a universal pricing model.

“The spirit of the bill is to provide easy information to the people who need it,” said committee Chairman Tim Ashe, D-Chittenden. “I just want to know if we have a casino situation where the house always wins and the consumer always loses.”

Nancy Hogue, director of pharmacy services for the Department of Vermont Health Access, said the idea of universal pricing is nothing new.

Nancy Hogue offers testimony Tuesday on the efficacy of universal drug pricing.

Josh O'Gorman / VPB

Nancy Hogue offers testimony Tuesday on the efficacy of universal drug pricing.

“This is certainly a topic that has been kicking around a long time,” Hogue said. “Conceptually, it seems like a good idea for providers because they will know which drug is preferred and what the cost sharing would be.”

However, Hogue said the actual implementation of a universal pricing model would be “mechanically difficult,” because every insurance company negotiates its own drug prices with pharmaceutical companies.

“I don’t believe this is will be the most cost-effective strategy in the long run.” Hogue said.

Madeleine Mongan, vice-president of the Vermont Medical Society, said her organization would support universal pricing, but lacks the resources to support it.

Madeleine Mongan testifies Tuesday on S.216.

Josh O'Gorman / VPB

Madeleine Mongan testifies Tuesday on S.216.

“We don’t have a lot of hope for this, but it would be great to have something like this,” Mongan said.

In written testimony offered to the committee, Kristina Ragosta Arnoux, regional director of government affairs for CVS Health — which represents eight retail pharmacies in the state — argued the bill would result in higher costs and encourage the use of less-effective medications.

“Mandates imposed by government restrict the ability to deliver a quality product and decrease the affordability and financial sustainability of the benefit,” Arnoux wrote.

Cory Gustafson, director of government and public relations for Blue Cross/Blue Shield of Vermont, argued the best way to keep a lid on increasing drug prices is to use generics.

Cory Gustafson discusses generic drug pricing Tuesday with the Senate Finance Committee.

Cory Gustafson discusses generic drug pricing Tuesday with the Senate Finance Committee.

According to Gustafson, since 2008, his organization has increased its use of generic drugs from less than 60 percent to 85 percent. Every 1-percent increase in use of generic drugs results in a 2.3-percent savings in drug costs, Gustafson said.

josh.ogorman@timesargus.com

Leave a Reply

Your email address will not be published. Required fields are marked *