The South Carolina House is entertaining bills that would, among other things, prevent pharmacy benefit managers from imposing gag clauses on pharmacists.
S. 0815 / H. 5038 / H. 5044 would prevent PBMs from putting gag clauses in their contracts with pharmacists. The bill was introduced in the Senate in December 2017, and in the House in March 2018. The bill has passed the Senate, and currently is in the Committee on Medical, Military, Public and Municipal Affairs. In part, the bill reads:
“A pharmacy benefit manager may not: (1) prohibit a pharmacist or pharmacy from providing an insured information on the amount of the insured’s cost share for a prescribed drug and the clinical efficacy of an alternative drug, if available. The pharmacist or pharmacy may not be penalized by a pharmacy benefit manager for disclosing such information to an insured or for selling an available alternative drug[…]”
Pharmacy benefit managers can tell your pharmacist what to say – and it could cost you money.
Currently, some pharmacists are not able to tell patients when they could be paying less for their medications because PBMs put gag clauses in their contracts. PBMs sometimes set the copay price of a drug (what you pay if you used insurance) higher than the list price of the drug (the price you pay without using insurance). When insurance companies do this price setting, it is called a “clawback.” Gag clauses order a pharmacist not to tell you about the clawback, so they cannot say if you could pay less for a drug if you did not use your insurance. This results in higher prices for the patient. This practice is especially detrimental for people with diabetes because they pay about 2.3 times more on healthcare than people without diabetes. Gag clauses are surprisingly widespread; some independent pharmacists estimate that if they were allowed, they could have saved their patients money in about 10% of transactions. DPAC has done a deep dive into gag clauses on our blog.