HomeUncategorizedPACT Act Clears State Senate, Headed for House

PACT Act Clears State Senate, Headed for House

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A bill to control prescription drug prices: Kennedy endorses act in statement.

On Thursday afternoon the Massachusetts Senate passed An Act relative to Pharmaceutical Access, Cost and Transparency (PACT Act 2022), comprehensive cost control legislation which addresses the rapidly rising costs of prescription drugs. This bill puts the Senate at the forefront of the Commonwealth’s efforts to address rapidly increasing prescription drug costs by connecting the need for greater drug price transparency with policies to improve oversight for the pharmaceutical industry, effectively reducing drug costs for patients and lowering health care costs overall.

“Medication prices are one of the largest obstacles patients in the First Middlesex District, and statewide, are faced with when accessing care,” explained State Senator Ed Kennedy. “The PACT Act gives the Massachusetts State Government more authority to regulate the price of prescriptions so patients may obtain the drugs they need and the care they deserve.”

High prescription drug costs often prohibit patients from accessing the medication they need. Contained within the 2022 PACT Act are enhanced accountability tools to address this and other barriers to care. The bill directs the Health Policy Commission (HPC) to consult with stakeholders and establish a process to identify price thresholds for medication that pose a risk to public health. Additionally, the HPC is allowed to recommend pricing measures to boost patient access to necessary drugs. Failing to comply with this process will result in drug manufacturers paying a fee into a trust fund for a new drug cost assistance program, supporting patients of certain chronic health conditions that disproportionately impact low-income communities and communities of color.

The PACT Act also offers immediate price relief for insulin, a life sustaining daily drug of which the price has recently risen sharply and is relied upon by one in ten residents of the Commonwealth. Due to the price increase, patients in high-deductible plans or who are underinsured may pay out of pocket costs of $1000 or more per year. Patients often ration or forgo their use of insulin to circumvent this financial burden. The PACT Act 2022 places a limit on out-of-pocket spending for insulin through eliminating deductibles and coinsurance, and capping co-pays at $25 per 30-day supply.

Pharmacy benefit managers (PBMs) will also be brought under the oversight of the Division of Insurance (DOI). PBMs serve as middlemen during the drug transaction process and play a major role in how medications are priced and tiered on insurance plans. This legislation also grants independent pharmacists the ability to obtain a license to provide specialty medications and work with insurance plans to ensure patients receive their necessary medication. In conjunction with this change, the PACT Act gives Massachusetts residents greater access to mail order prescriptions, allowing network pharmacies to contract with carriers to provide mail-order drugs. These changes ensure patients pay a fair price for; and receive their prescriptions in the manner that suits them. 

Furthermore, pharmaceutical companies are now required notify the state before new drugs come to market or significant price increases for existing drugs. Through advanced notification, MassHealth will be better positioned to mitigate price increases through price negotiation and other cost reducing measures. The Health Policy Commission will also utilize advanced notification focus on these cost drivers at their yearly Cost Trends Hearings which examine the drivers of health care costs and discuss the challenges and opportunities for improving care and reducing costs across the state’s health care system.

“Access to adequate care is a societal need that had been made evident after two years of the COVID-19 pandemic. I am proud to collaborate with my colleagues in the Senate to work on legislation that addresses the needs of the residents of Massachusetts” said Senator Ed Kennedy.

The Massachusetts State Senate played a leading role in addressing the high cost of prescription drugs. The 2017 HEALTH Act ensured costumers are offer the lowest possible prices at the pharmacy through incorporating pharmaceutical costs into the state’s annual health care cost oversight process. Provisions were included in the Fiscal Year 2020 budget allowing MassHealth to negotiate supplemental drug rebates, saving the State millions of dollars every year. The PACT Act was passed its first iteration during the 2019 – 2020 session, and the PACT Act 2022 makes significant improvements in patient access and reining in drug costs throughout the Commonwealth’s healthcare system.

The bill now goes to the House for consideration.