Health+Benefits

What Does the Removal of Pharmacy ‘Gag Clauses’ Mean for Consumers?

The Senate passed The Patient Right to Know Drug Prices Act, which bans gag clauses aimed at prohibiting pharmacists from informing customers that they could save money on certain prescriptions by paying out of pocket instead of through their health insurance.
By Katie King Posted on September 20, 2018

The Senate passed The Patient Right to Know Drug Prices Act, which bans gag clauses aimed at prohibiting pharmacists from informing customers that they could save money on certain prescriptions by paying out of pocket instead of through their health insurance.

The Council Perspective: This bipartisan-supported bill intends to make it easier for patients with employer-sponsored, and individual, insurance to pay the lowest price for prescriptions. According to The Journal of the American Medical Association, in 2013, gag clauses triggered $135 million in overpayments in Optum commercial health plans. However, most large PBMs claim to no longer use gag clauses, so it’s not clear how effective this new bill will be in lowering healthcare costs for consumers.

The Council supports the removal of gag clauses despite this uncertainty. Click here for our position on drug pricing transparency.

Katie King Vice President, Health Policy & Strategy, The Council Read More

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