California Lawmakers Will Consider Limits on Prescription Drug Costs

Besides a special session on Medi-Cal, the big health care issue waiting action by lawmakers when they return from summer recess today is the high cost of new specialized prescription drugs.

People need them but the costs are jaw dropping: A new drug that cures Hepatitis C with minimal side effects costs $94,000. The question for lawmakers is how to make them affordable.

A per-prescription cap on out-of-pocket costs for patients does that but does nothing to encourage drug companies to lower costs — and is likely to prompt health plans to raise premiums because they’ll have to pick some of the tab.

Opposition from drug in companies already sidelined legislation to disclose production costs of expensive specialty drugs.

In May, Covered California became the first health benefit exchange in the nation to set caps on how much consumers pay for these medications. The caps range from $250 per month to as much as $500 per month.

Assembly Bill 339 by Democratic Assemblyman Rich Gordon from Menlo Park would limit monthly patient costs to $250 for a 30-day prescription.

Health plans and the California Chamber of Commerce oppose the bill.

“Capping costs (to patients) is not going to solve this,” CalChamber lobbyist Mira Morton said. “It shifts costs to the plans and plans will shift it to premiums.”

The increase probably won’t be significant the first year, but could grow over time, Morton said.

A number of bills seek to address the issue, but they threaten the affordability of health care and do not offer “real solutions to curb unfettered drug pricing that could threaten access to important treatments,” said Nicole Kasabian Evans, a spokeswoman for the California Association of Health Plans.

Among other high-profile health-care legislation still in the works, Assembly Bill 533 seeks to protect consumers from unexpected bills if they are treated by an out-of-network provider and SB 137 seeks to improve the accuracy of provider directories.

All bills have to make it to the Senate or Assembly floor by the end of August. Only bills approved by the Legislature by Sept. 11 will be sent to Gov. Jerry Brown for action. His last day to sign, veto or allow a bill to become law without his signature is Oct. 11.

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