A bill making its way through the Senate that promises to cut prescription drug prices could have an unpleasant side effect: an invasion of medical privacy.
THE Pharmacy Benefit Manager (PBM) Transparency Act 2022a bipartisan effort led by Sens. Maria Cantwell (D – Washington) and Chuck Grassley (R – Iowa) aim to crack down on middlemen in the pharmaceutical supply chain.
These drug benefit managers are third-party administrators who work with private insurers and government-run health programs like Medicare to manage price negotiations, insurance claims, and rebate programs. PBM advocates claim that they save patients money by negotiating higher discounts pharmaceutical companies and pass on the savings. A PBM working on behalf of an insurance company could deal with a drug manufacturer for a lower price per dose in exchange for that company’s drug being the one the insurance company prioritizes in the prescription list that it makes available to policyholders.
However, PBMs have other incentives, such as favoring more expensive drugs or keeping part of these discounts, which can drive up costs— and, like so much else in the US healthcare system, the lack of real prices makes it impossible to know how much things cost.
Cantwell and Grassley’s bill attempts to address some of that opacity by giving government agencies the power to investigate PBM pricing schemes. The bill requires PBMs to file an annual report with the Federal Trade Commission (FTC) on fees charged to pharmacies and reimbursements requested from pharmaceutical companies.
This is where it gets tricky. In addition to the FTC’s authority, the bill also authorizes state attorneys general “to conduct investigations, administer oaths or affirmations, or compel the attendance of witnesses or the production of documentary or other evidence “.
In short, it could allow attorneys general to search for patient-level information about prescriptions, including potentially sensitive information about whether individuals were prescribed, for example, abortive drugs or hormones used in transitions. gender.
The bill appears to give “enormous power” to state attorneys general to seek information about PBMs and the patients who are their clients, says Caleb Kruckenberg, an attorney at the Pacific Legal Foundation, a libertarian legal nonprofit. .
“If an attorney general were to bring a lawsuit against a pharmacy or a PBM, the details of the prescriptions filled by the pharmacy and for whom would be relevant and, therefore, almost certainly subject to discovery,” Kruckenberg said. Raison. “The Attorney General could potentially review every transaction at a pharmacy for compliance involving specific drugs, including highly personal drugs like Prozac, Viagra or mifepristone.”
“Patients may not even know their data is being leaked,” said Greg Dolin, a University of Baltimore law professor and senior litigation attorney at the New Civil Liberties Alliancea non-profit organization that defends constitutional rights, says Raison.
Given that the main thrust of the bill appears to be aimed at reimbursement and financial matters, it is unclear whether patient data would be directly at risk. But if an attorney general seeks prescription information under the bill’s provisions, “it’s not clear who would represent patients’ interests,” Dolin says.
The PBM bill was flagged by the Senate Commerce Committee in December and is awaiting a vote. Earlier this month, Axios reported that it could be included in a broader package of health care reforms that Senate Majority Leader Chuck Schumer (D – NY) aims to introduce to the Senate in May.
While there’s nothing in the bill that explicitly requires PBMs to disclose patient-level data to the FTC or state attorneys general — and any future litigation over its provisions would likely be limited to fighting for financial information – some civil liberties advocates are concerned about the open-ended nature of the bill’s enforcement provisions.
“I fear that an activist attorney general could use the patient-level health data thus collected to find out which of their constituents have taken COVID-19 vaccines or taken other treatments in which they have an ideological or political interest, which could lead to discrimination or other civil penalties,” says Jeffrey A. Singer, physician and principal investigator at the Cato Institute.
A better solution, of course, would be to overhaul the entire US health insurance system to make room for more markets and real price signals, rather than layering another set of regulations and asking for more government monitors – at the FTC and state attorney general’s offices. — to decide how much things should cost and who should benefit from them. Policymakers should empower health care consumers to make informed decisions, rather than relying on potentially politically motivated attorneys general to control prescription drug prices.
Instead, we get this insider fight between big pharma, who blame PBMs for the high cost of drugs and want to see more federal regulation of them, and the insurance companies, which have worked to bring PBMs under their control
Patients, unsurprisingly, will be caught in the middle.