A bill sponsored by Maine Sen. Susan Collins that would prohibit “gag clauses” preventing pharmacists from informing patients that paying out-of-pocket in some cases would be cheaper than using their health benefits cleared a key Senate committee Wednesday.

The bill, the Patient Right to Know Drug Prices Act, now will likely go to the Senate floor in the coming weeks. The bill would prohibit health insurers and pharmacy benefit managers from writing “gag clauses” into contracts with pharmacists that prevent the pharmacists from telling customers about cheaper options. Pharmacy benefit managers are middlemen that insurers pay to set up a list – called a formulary – of what drugs are covered by the health insurance plan. The formularies are designed to save money, but can have unintended consequences.

With patients shouldering more of the cost of prescriptions as health benefits have changed over the past 20 years, pharmacy benefit managers have come under greater scrutiny.

In some cases, a complicated web of rebates that pharmacy benefit managers obtain from pharmaceutical companies but are not available to patients can skew the cost of getting a prescription so that it’s actually cheaper to pay out-of-pocket. To make sure that patients were still using their health plan, the benefit managers inserted “gag clauses” into contracts with pharmacists so the pharmacists could not tell patients that a less expensive option was available.

According to a 2016 study by the University of Southern California that examined 2013 prescription data, one of four prescriptions in the United States involved an unnecessary overpayment caused by the insurance company or pharmacy benefit manager, totaling $135 million in overspending by patients.

“Insurance is intended to save consumers money. Gag clauses in contracts that prohibit pharmacists from telling patients about the best prescription drug prices do the opposite,” Collins said during the Senate Health Committee meeting Wednesday.


The Portland Press Herald recently highlighted complaints about pharmacy benefit managers, including excluding drugs from coverage that some patients need.

Collins’ bill is co-sponsored by Democratic Sens. Claire McCaskill of Missouri and Debbie Stabenow of Michigan, and Republican Sens. John Barrasso of Wyoming and Bill Cassidy of Louisiana. The Trump administration has indicated it supports the measure.

A separate bill would provide the same consumer protections for those covered by Medicare Advantage and Medicare Part D plans.

Joe Lawlor can be contacted at 791-6376 or at:


Twitter: joelawlorph

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