S. 2553 prohibits a Medicare Advantage plan provider or a provider of a Medicare Part D prescription drug plan from restricting the ability of a pharmacy to inform “an enrollee in such plan of any differential between the negotiated price of, or copayment or coinsurance for, the drug or biological to the enrollee under the plan and a lower price the individual would pay for the drug or biological if the enrollee obtained the drug without using any health insurance coverage.”.

The effective date for the Know the Lowest Price Act is for plan years beginning on or after Jan. 1, 2020.

S. 2554 prohibits a “group health plan or health insurance issuer” from restricting, directly or indirectly, “any pharmacy that dispenses a prescription drug to an enrollee in the plan or coverage from informing ,,,an enrollee of any differential between the enrollee's out-of-pocket cost under the plan or coverage with respect to acquisition of the drug and the amount an individual would pay for acquisition of the drug without using any health plan or health insurance coverage.”

S. 2554 also seeks to “ensure that any entity that provides pharmacy benefits management services under a contract with any such health plan or health insurance coverage does not, with respect to such plan or coverage, restrict, directly or indirectly, a pharmacy that dispenses a prescription drug from informing (or penalize such pharmacy for informing) an enrollee of any differential between the enrollee's out-of-pocket cost under the plan or coverage with respect to acquisition of the drug and the amount an individual would pay for acquisition of the drug without using any health plan or health insurance coverage.”

S. 2554 does not include an effective date.

What do insurance groups say about pharmacy gag clauses?

Some in the insurance industry have said they believe use of drug plan gag clauses is rare. In September, for example, David Yoder, an executive at the Blue Cross Blue Shield Association, testified at a House hearing that he had not heard of any of the Blues, or the Blues' outside pharmacy benefits managers, imposing gag clauses on pharmacists.

In March, America's Health Insurance Plans said, in a statement, that it supports efforts to ban pharmacy benefits gag clauses but believes those gag clauses are rare.

“This doesn't solve the problem of patients being unable to afford their medications because drug prices are simply too high,” AHIP said.

What is the president saying about drug prices?

Trump said Wednesday, at a signing ceremony, that he sees the two new drug benefits information laws as the result of his administration's drug pricing blueprint initiative.

“Within a week of announcing the blueprint, my administration began to crack down on so-called 'gag clauses' in Medicare Part D plans,” Trump said, according to a copy of his remarks provided by the White House. “You all know what that is. These clauses prevent pharmacists from telling patients about more affordable options for prescription drugs.”

The new laws build on that effort, Trump said.

“Our great citizens deserve to know the lowest price available at our pharmacies, and now that is what they will be getting,” Trump said. “They'll be able to see pricing. They'll be able to see where they should go. And as they start leaving certain pharmacies, those pharmacies will be dropping their prices.”

Trump thanked Collins and Stabenow for their efforts. He also praised Sens. Lamar Alexander, R-Tenn., and Bill Cassidy, R-La., and Rep. Buddy Carter, R-Ga.

Resources

A video of the signing ceremony is available here.

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