Groups Call for a Closer Focus on Pharmaceuticals

First a quick refresher: when the state released information earlier this year about how all the parts of the Massachusetts healthcare system are meeting the state’s healthcare cost growth benchmark of 3.6%, a few points became very clear: first, the rates of growth for hospital inpatient (2.2%) hospital outpatient (2.9%) and physician services (1.9%) all fell well below the 3.6% benchmark.  And second, the factor that has consistently exceeded the benchmark, causing the state’s entire healthcare system to miss the mark, has been pharmacy spending. Pharmacy spending accounted for a full one-third of overall growth in the state’s total health care expenditures.

This past week, a broad coalition of organizations, including MHA, and those representing  employers, health plans, and physicians called for passage of legislation (House Bill 3223 and Senate Bill 627) to promote transparency in prescription drug prices.

Specifically, the bills (filed by Representative Christine Barber (D-Somerville) and Senator Linda Dorcena Forry (D-Dorchester)) would direct the Health Policy Commission to identify up to 15 prescription drugs whose prices increased by 15% or more over the last 12 months, 50% or more over the last five years, or a new drug whose price may have had a significant effect on the state's cost benchmark. Additionally, drug manufacturers that propose to increase their prices by 10% or more would be required to notify the HPC 30 days before the increase takes effect, and pharmaceutical and biotech companies would be required to testify under oath as part of the HPC's annual healthcare cost trends hearings.

"In Massachusetts, hospitals have been joined by the entire healthcare community in the effort to contain costs and advance access to safe, accessible and efficient care for all," said Lynn Nicholas, President and CEO of the Massachusetts Health & Hospital Association. "In order for the Commonwealth's reform initiatives to succeed, all stakeholders must work cooperatively. As rising pharmaceutical costs are a key driver of overall increases in health care spending, pharmaceutical companies need to be included in the conversation."

Organizations supporting the bills include: MHA, Massachusetts Medical Society, National Federation of Independent Business, North Shore Chamber of Commerce, Massachusetts Association of Health Plans, and Springfield Regional Chamber.