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Wait before expanding drug board’s power
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As the first state in the nation to establish a Prescription Drug Affordability Board, Maryland policymakers pride themselves on taking steps to increase patient affordability and alleviate health care cost burdens for Marylanders.
However, while state lawmakers tout the establishment of the PDAB as a talking point to support expanding the bureaucratic board’s authority, patients are still waiting to see meaningful change at the pharmacy counter as a result.
It is critical that Maryland legislators oppose expanding the board’s authority to further interfere with the health care financing ecosystem. Without heeding concerns from patient groups and understanding the real-world impact of price setting tactics on patient access and affordability, lawmakers will threaten equitable access to life-saving medications.
Enacted by the General Assembly in 2019, Maryland’s PDAB is an independent board of government appointees who examine health care affordability in the state. For the past several years, the PDAB has been developing a plan to identify high-cost prescription drugs, conduct affordability reviews on a select number of identified drugs, and recommend policies as an attempt to rein in high health care costs.
At first glance, this concept sounds great. However, upon closer inspection, the legislation that established the Maryland PDAB provided the board with one tool to limit prescription drug costs. The board has the authority to set an upper payment limit (UPL) on drugs for Marylanders with insurance through state and local government health plans. UPLs set a maximum amount that a payer — or an entity that pays for the care services administered by a health care provider — can reimburse providers for a drug they purchase. Nothing in the legislation requires any realized savings to be passed onto patients.
For health care providers, UPLs can lead to lower reimbursement rates than what it costs them to acquire and administer the medication. Ultimately, if a provider or pharmacy loses out financially and is forced to not carry or prescribe any medication with a UPL, patients in Maryland will not be able to access the medication that is best suited to them.
Price setting policies such as UPLs disproportionately impact disinvested and poorer areas, blocking access to timely and effective care. Consider the impact on a patient community if providers cannot carry and dispense a medication due to a UPL. Patients could be forced to travel long distances to access the medication they need, switch to a less effective treatment plan, or even abandon a provider-recommended treatment plan.
Older individuals living with chronic conditions, such as cardiovascular disease, HIV, and arthritis, rely on provider-prescribed treatment plans to lead healthy lives. On top of the day-to-day burdens these price setting policies can trigger, they can compound ongoing health challenges, lead to higher future medical costs, and create barriers between the best judgment of patients and their doctors.
Moreover, patient communities hoping for novel treatments, such as in cancer and for rare diseases, may be negatively impacted by decreased investment in new drug development.
Despite the ways prescription drug price-setting policies can exacerbate treatment access challenges, this legislative session several Maryland lawmakers introduced legislation (HB0340 / SB0388) to expand authority of the PDAB to set UPLs for all health care plans.
While addressing barriers to patient access and treatment affordability should remain a priority for the General Assembly, Maryland’s PDAB has yet to achieve any goals set out by the original legislation. Maryland does not have any tangible evidence that UPLs are effective in alleviating cost burdens for patients.
Premature efforts to expand the PDAB could have an outsized negative impact on patient access and affordability challenges, and lawmakers must consider all drivers of high health care costs and look to solutions that will meaningfully address such challenges, not compound them.
Ten other states in the country have also established prescription drug affordability review initiatives, with Colorado’s PDAB the farthest along in the process of conducting affordability reviews on five medications deemed to have too high a cost for patients, including medications to treat HIV, cystic fibrosis, psoriatic arthritis, and more.
Still, no PDAB in the country has effectively executed price controls on any medications or shown these policies are effective in bringing down patient out-of-pocket costs.
Expanding the authority of Maryland’s PDAB before the board has demonstrated success in lowering health care costs could do more harm than good on Maryland’s most vulnerable populations. The General Assembly must halt efforts to further empower the board. Otherwise, patients across Maryland will bear the burden of misguided price-setting policies.
