Joint Committee on Financial Services
The Massachusetts Health & Hospital Association (MHA), on behalf of our member hospitals, health systems, physician organizations and allied healthcare providers, appreciates the opportunity to submit comments regarding legislation that affects the relationship between pharmaceutical organizations and health insurers.
MHA supports HB1013 / SB562. This proposal would prohibit contracts between carriers/pharmacy benefit managers and pharmacies from having clauses barring pharmacists from disclosing the cost of a prescription, availability of alternatives, and the option to pay by cash rather than using the health insurance benefit if it’s less costly. Carriers cannot require a patient to pay any more than he or she would in the absence of health insurance coverage.
MHA also supports HB969 / SB561 which would require health insurers to: post their drug formularies in an easily accessible and searchable manner; use a standard template to display formulary information and make comparisons among plans easier; include clear information about how deductibles will be applied; and detail applicable quantity limits, step therapy, or prior authorization requirements. The provisions outlined under HB969 / SB561 would reduce confusion and provide consumers with greater transparency around their prescription drug benefits.
MHA supports the intended purpose of HB915/ SB582, which appears to require coverage for the dispensing of specialty drugs under the pharmaceutical drug benefit by non-network pharmacies that provide special handling, administration and monitoring for such drugs. Recent changes to certain health insurer benefit structures require some patients to obtain non-self-administered, injected or infused specialty medications through a specialty pharmacy. In many cases, these medications are no longer covered by insurance companies unless patients self-administer the medication, use a visiting nurse. or bring the drug to their physician’s office or hospital to be administered by a clinician – a practice known as “brown-bagging”. Hospitals believe that there are significant patient safety concerns associated with this practice as it relates to a subset of drugs used for supportive care of oncology and other chronic disease patients. The integrity of the affected prescription drugs – which have specific handling, storage and temperature control requirements, and, in many cases, are compounded prior to administration – cannot be verified in cases where a patient procures the medication on his or her own and brings it to a hospital or clinic for administration. As a result, providers are unable to confirm that the medication has not been exposed to conditions that would render it ineffective or unsafe.
In July, the Health Policy Commission (HPC) released a report (required by Section 130 of Chapter 47 of the Acts of 2017) on the use of third party specialty pharmacies for certain clinician-administered medications. The report considers “the prevalence and impact of health insurers’ policies that seek to reduce overall pharmaceutical spending by requiring alternative methods of distribution and payment for certain costly specialty drugs.”
The HPC found that third-party specialty pharmacy treatment methods have costs and cost-sharing amounts that can vary widely, and each method poses different potential challenges to safety that must be addressed to ensure that patients are receiving the most appropriate treatment in the right setting. The commission’s recommendations include: i) a prohibition of insurer-compelled brown bagging for any drugs; ii) including home infusion as an optional benefit for patients – not a requirement from insurers; iii) establishing minimum safety standards and capabilities utilized by insurers for the third-party specialty pharmacies with whom they contract; iv) adoption of best practices and site neutral payment policies for white bagging; v) the passage of legislation to increase public transparency and scrutiny of the drug entire distribution chain; and vi) adoption of best practices in this area by the state’s Group Insurance Commission, Health Connector and MassHealth for all plans with which they contract.
The report also lays out further concerns with these methods that providers identified during the public hearing process, including the fact that white and brown bagging can have the unintended consequences of creating uncompensated provider expenses as well as increasing the administrative complexity in the healthcare system. These include the lack of payment for the intake and storage of drugs after receiving them from third-party specialty pharmacies, and disparate payer policies that include different coverage rules, applicable drugs, exceptions processes, and networks and standards for specialty pharmacies that consume staff resources and increase administrative expenses.
Thank you for the opportunity to offer testimony on this matter. If you have any questions regarding this testimony, or require further information, please contact Michael Sroczynski, MHA's Senior Vice President of Government Advocacy at (781) 262-6055 or msroczynski@mhalink.org