Connecticut touts drug savings, pitches ideas on limiting prescription costs

CT Examiner – Friday, December 27, 2024
By Emilia Otte

Over a year into the launch, a small number of Connecticut residents are taking advantage of a prescription drug discount card program that the state says can save consumers between 20 and 80 percent on prescription drug costs.

About 22,100 Connecticut residents have signed up for the state discount card, ArrayRx, since its launch in 2023. According to the state Comptroller’s Office, consumers with the discount card have saved an average of $277 per prescription.

“If you’re a person on a fixed income here in Connecticut, that’s a big deal,” Comptroller Sean Scanlon told CT Examiner in a phone interview.

But while the card has produced savings for those who signed up, it’s not enough to address the underlying affordability problem that plagues the state and the country.

Scanlon told CT Examiner that Connecticut had been more successful in getting a larger proportion of residents to sign up for the card in comparison to Washington and Oregon, the two other states who are part of ArrayRx, even without a big marketing budget. But he said he wanted more.

“There’s three and a half million people that live in this state and a lot more people should be signing up for this card,” Scanlon said.

Scanlon said he’d had conversations across the state, often with seniors and people who are uninsured or underinsured.

“This is not just for any one kind of person. This is for every single person in Connecticut, and there is nobody in Connecticut who is not affected by the rising cost of drugs,” Scanlon said.

The ArrayRx discount card is able to lower the price that consumers pay for drugs by relying on bulk discounts — Oregon and Washington states contracted with the Pharmacy Benefit Manager Navitus and Pharmacy Benefit Administrator Moda Health to administer a variety of services, including the discount card.

According to the Comptroller’s Office, participating in ArrayRx does not cost Connecticut anything. When Washington and Oregon have to go out for procurement in 2028 — either to renew their contract or change administrators for the program — Connecticut will have to contribute to the associated legal fees.

The major savings from ArrayRx come from generic drugs — patients can save up to 80 percent of the cost on those.

But the larger costs to patients come from brand-name drugs. Mounjaro, for example, a drug used to lower blood sugar in people with Type 2 Diabetes, has about a $1,000 retail price for a 30-day supply. The ArrayRx discount card will lower that price to $262.

Ed Schreiner, Vice President of Network Development for the Northeast Pharmacy Service Corporation, said he saw positive and negative aspects of the ArrayRx program.

Because ArrayRx is a state-run program, Schreiner said, its data privacy restrictions were stronger than commercial discount cards like GoodRx, which in February was subject to action from the Federal Trade Commission to ban it from sharing health data with other companies.

But Schreiner said he’s not sure how many people the ArrayRx card actually helps.

Schreiner, who owned Stoll’s Pharmacy in Waterbury for 30 years until he sold the business in May, said the majority of people living in his neighborhood were either on Medicare or on HUSKY. He said the discount card would be helpful for people without insurance, but that it wouldn’t necessarily assist people who already had coverage.

According to census data provided by the state Office of Healthcare Strategy, about 8.1 percent of Connecticut residents were uninsured as of 2023.

Schreiner said that whether the discount card offered better prices than someone’s insurance varied depending on the drug. But he also warned that for people with high deductibles, it may not be an advantage to use the discount card because the discount won’t apply to their deductible.

“Maybe you have to do $1000 in a year before insurance kicks in and pays a portion of it. It may be to your advantage to pay a little more under your plan because you’re going to get to that $1000 and then you’re going to get coverage, where under ArrayRx … there is no point where they’re actually going to pay anything,” said Schreiner.

Schreiner said that sometimes discount cards also don’t reimburse pharmacies the full amount of the drug, which means the pharmacies lose money, although he said he has never experienced that with ArrayRx. Stephanie Krieg, strategic communications director at the Health Policy & Benefits Division of the Office of the State Comptroller, said they have not received any complaints about pharmacies not being fully reimbursed by ArrayRx.

“ We’re not collecting rebates and we’re not chasing coupons. So we make sure that the pharmacies are paid a proper dispensing fee as well as the ingredient price,” Leta Evaskus, the Pharmacy Strategy & Innovation Manager for the Washington Health Care Authority, told CT Examiner. “ A lot of discount cards are actually negatively affecting pharmacies, not fully reimbursing them … and that really impacts the small pharmacies, the independents and … what we call critical access pharmacies. We don’t want those to close.”

Getting at the real cost

Last month, the state launched a prescription drug task force to look at other ways the state can lower the price of drugs. Some of the policies under consideration include legislation regulating Pharmacy Benefit Managers — companies that negotiate prices between insurers and drug manufacturers. Schreiner, who is on the task force, said these Pharmacy Benefit Managers take fees from the manufacturers, causing the manufacturer to raise the price of their drug. The result, he said, is that customers end up paying more.

“Personally, I think the PBMs are middlemen that drive up costs based on their rebate schemes,” Schreiner said.

Greg Lopes, vice president of public affairs and communications with the Pharmaceutical Care Management Association, which represents Pharmacy Benefit Managers, told CT Examiner in an email that PBMs allow employers to offer benefits to patients.

“Whether it’s through negotiations to lower costs, partnerships with pharmacies, or clinical care programs, our value is in helping patients access affordable prescription drugs,” the statement read.

Schreiner also said that Pharmacy Benefit Managers incentivize preferential treatment toward brand-name drugs rather than cheaper generics because they generate more money in rebates for the PBMs.

Sam Hallemeier, senior director for state affairs for the Pharmaceutical Care Management Association, said during a December 16 meeting of one of the Prescription Drug Task Force working groups that sometimes, preferring the brand drug actually lowers the cost overall, and that those savings are passed back to insurers, who can then lower premiums for consumers.

Connecticut has already passed laws requiring PBMs to turn over data to the state Insurance Department, and limit the amount that consumers would have to pay for a drug.

Drew Gattine, a Senior Policy Consultant for the Center for Prescription Drug Pricing at the National Academy for State Health Policy, said in a presentation to task force committee members on Dec. 16 that some common laws in other states include prohibiting gag clauses on pharmacists that prevent them from directing customers to lower-priced options, requiring PBMs to be licensed and requiring rebates and coupons that limit the amount a patient has to pay for a drug.

But Gattine also said there was not much data that showed that these laws had an effect on decreasing drug costs.

Another subcommittee of the task force discussed the idea of a Prescription Drug Affordability Board in Connecticut, which would select certain drugs to evaluate and establish a maximum cost that people would have to pay for the drug. These boards could use international pricing rates or Medicare pricing rates to determine what cap to place on a drug cost.

Jennifer Reck, the director of the Center for Drug Pricing at the National Academy for State Health Policy, noted that manufacturers made drugs available at different prices depending on the market.

But some members of the group argued that capping drug prices could risk the drug becoming unavailable in the state.

Rachel Cottle Latham, the director of the Pharmaceutical Research and Manufacturers of America, a group representing the pharmaceutical manufacturers, said she had “significant concerns” about proposals that would set an upper limit on drug prices.

“We view these approaches as a short-sighted target of drug spending without considering the complexity of the supply chain,” she told the task force committee on Dec. 19, adding that more than half of spending on brand medications went to an entity other than the manufacturer.

Many people on the task force noted that the state of Connecticut is limited in what it can do — many health insurance plans fall under the jurisdiction of the federal government.

Scanlon said he believes the federal government needs to negotiate drug prices, and he pointed to a provision in the Inflation Reduction Act that would allow Medicare to negotiate the price of 10 drugs. The same bill, he said, allowed the federal government to cap the amount that Medicare enrollees pay in out-of-pocket expenses. He said he believed that the $2,000 annual cap should be extended to all Americans.

“ We spent almost a hundred million dollars just on those [ten] drugs for the 60,000 retirees that are in our pool on an annual basis. So that tells you how expensive these drugs are and what the benefit will be once we start getting better prices for those drugs,” Scanlon said.

In the meantime, he’s continuing to promote the ArrayRx card. He said he’s reached out to colleagues in other New England states as well, about the possibility of more states joining ArrayRx.

“ At this point, it’s just about spreading the word. There’s no cash to this. There’s no … big costs to it. It’s just about trying to get more people educated about it,” he said.

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