Legislative Update: Week of October 14, 2019

Oct 14, 2019


CHIA released their 2019 Annual Report on Tuesday, finding that net of rebates, pharmacy spending was $8.1 billion, an increase of 3.6% from the prior year but slower than the prior year’s net growth rate of 3.7%. MassBio CEO Bob Coughlin issued the below statement in response to the findings.

“Despite the heightened focus on prescription drug prices by policymakers, CHIA’s 2019 Annual Report shows the spending growth rate on prescription drugs, net of rebates, is declining year-over-year for the third year in a row. As CHIA’s report demonstrates, Massachusetts payers’ collective spend on prescription drugs was reduced by $255.4 million, or 47%, through rebates and discounts they received from drug manufacturers. Using this measurement of the real costs to the state’s healthcare system, prescription drugs are the third smallest category of healthcare spend and the fourth smallest contributor to the change in total healthcare expenditures. As our state’s policymakers consider healthcare reform legislation this session, we urge them to look carefully at the real drivers of healthcare costs in Massachusetts and examine why health insurance out-of-pocket costs and premiums are growing at twice the rate of inflation and substantially faster than the state’s at-benchmark 3.1% total healthcare expenditure growth rate.”

Also on Tuesday, the Joint Committee on Health Care Financing heard testimony on Senate Bill 1235, relative to step therapy and patient safety, and House Bill 1853, relative to fail first and patient safety. If passed, these bills would reform step therapy and fail first protocols and establish a commission on step therapy protocol, as outlined in HB1853, to address the impact of step therapy on total medical expenses and health care quality outcomes.  


Congress is back in session this week, signaling pending moves on HR 3, “Lower Drug Costs Now Act.” According to a preliminary analysis from the Congressional Budget Office, the bill is projected to save Medicare $345 billion over 10 years but also reduce biopharmaceutical industry revenue by as much as $1 trillion over 10 years. As Congress begins debate over this bill, Speaker Pelosi wants the bill to be passed before the end of October.

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