New House Bill Focuses on Healthcare Price Transparency

The House Energy and Commerce Committee has introduced new legislation focused on healthcare cost transparency. The bill, titled Lower Costs, More Transparency, aims to increase price transparency through the healthcare system. The bill was introduced by Committee Chair Cathy McMorris Rodgers (R-WA), Frank Pallone, Jr. (D-NJ), House Committee on Ways and Means Chair Jason Smith (R-MO), and House Committee on Education and the Workforce Chair Virginia Foxx (R-NC).

Cathy McMorris Rodgers

“More than 60% of Americans are living paycheck to paycheck. It means they are just one medical bill away from a financial emergency. One doctor visit away from not being able to pay their rent, for their groceries, or gas,” Rodgers said in a video on her website.

Specifically, this new bill requires healthcare price information from hospitals, insurance companies, labs, imaging providers, and ambulatory surgical centers to publicly list the prices they charge patients. It also requires health insurers and pharmacy benefit managers (PBMs) to disclose negotiated drug rebates and discounts. The bill also aims to lower drug costs by expanding access to generic drugs

The full House of Representatives will likely consider this bill this month, said Patrick Cooney, president, The Federal Group.

This is the latest bill in an effort to address PBM business practices. Over the last two legislative sessions, many bills have been introduced in the both the House and the Senate. The bills come out of different committees, but have common themes: addressing transparency of drug and PBM pricing, pharmacy clawbacks, spread pricing and drug rebates.

This new bill combines aspects of previously submitted bills — on transparency related to prices on hospital services, laboratory tests, healthcare coverage and PBMs — into one package. For PBMs, this new bill includes H.R. 2679, which requires PBMs to provide employers with data on the acquisition cost of drugs, total out-of-pocket spending, formulary placement rationale, and rebate information. Additionally, this section requires the Government Accountability Office to submit a report on the practices of pharmacy networks of group health plans.

Also included in this bill:

• H.R. 4508, which requires PBMs and third-party administrators to disclose compensation to plan fiduciaries
• H.R 4507, which bans gag clauses that prevent pharmacists from telling patients about lower-cost drugs
• H.R. 1613, would ban spread pricing in Medicaid and would require that states pay an administrative fee to PBMs. This also supports the use of National Average Drug Acquisition Cost (NADAC) in Medicaid.

The efforts for bringing transparency to pharmacy benefits stems from employers’ needs for access to their data. “This seems to have brought Congress together,” Robyn Crosson, JD, vice president, government relations, Navitus Health Solutions, said during a session at the Pharmacy Benefit Management Institute’s annual conference in Orlando last week.

About 79% of voters support legislation that would require health insurance companies to disclose prices, according to a poll last year conducted by PatientsRightsAdvocate.org.