Trump signs bills lifting pharmacist ‘gag clauses’ on drug prices

President Trump signed two bills at the White House last Wednesday aimed at lowering pharmaceutical drug prices by promoting greater disclosure in drug pricing.

  • Know the Lowest Price Act
  • Patients’ Right to Know Drug Prices Act

The 2 bills are meant to prevent “gag clauses” in agreements between pharmacies and pharmacy benefit managers (PBM’s), who administer prescription drug programs for insurance companies, which pharmacists say kept them from disclosing cheaper drug options to consumers.

Under the new legislation, pharmacists will be allowed, though not required, to tell patients about lower-cost options.  For example, many prescription drugs are offered for free or at a low fixed cost for cash paying customers, but the cost for the same drug can be much higher when you use your prescription card and run it through your prescription drug plan.  This practice inevitably drives prices higher which ultimately results in insurance premiums.

By demanding pricing transparency, it will lead to smarter consumer shopping and price comparisons, which will result in price competition between retail pharmacy options, and ultimately lower costs. Steve Hoffart, a local pharmacist in Magnolia, Texas, who previously told NBC News about the difficulties of “gag clauses,” praised the bills as a victory for consumers.  “It’s a big win for patients,” he told NBC News. “It’s a big win for patients in terms of allowing pharmacists to openly discuss medication prices to save patient money and health care costs.”