The soaring cost of prescription drugs is among the greatest drivers in rising rates for Maryland insurance premiums, according to CareFirst CEO Chet Burrell. And, coupled with our aging population, it’s likely to propel health care spending in the U.S. to a record-breaking one-fifth of the economy by 2026.
These trends are unsustainable. Spiraling health care costs hurt Maryland families trying to make ends meet and seniors who are on fixed incomes and feel every increase in the cost of their prescriptions dearly. Law enforcement and first responders are being priced out of maintaining adequate supplies of Naloxone to respond to the opioid crisis, and the Medicaid program is having to ration access to a new cure for Hepatitis C because the price of these drugs has increased along with demand. While this may be standard economics, it’s a recipe for a health disaster of epic proportions.
In the absence of action at the federal level to address rising drug costs, Maryland has taken the lead on this critical issue. Last year, under the leadership of Attorney General Brian Frosh, we passed a law prohibiting price gouging on generic and off-patent drugs. This year, we’ve introduced legislation (Senate Bill 1023/House Bill 1194) to create a Drug Cost Commission that would set fair rates for high cost drugs in Maryland. We are pleased that 22 other senators and 78 other Delegates — a majority in the House and one short of a majority in the Senate — are cosponsors of this legislation and that it is a top priority of the Maryland Legislative Black Caucus.
This is a bill that can help Larry Zarzecki, a Parkinson’s patient and founder of Movement Disorder Education and Exercise. According to Larry, there is a treatment for Parkinson’s that is so expensive that only 32 of the 35,000 Marylanders who have his condition can afford it. These individuals already have a lot to deal with in their day-to-day lives. The skyrocketing costs of their prescription drugs shouldn’t be one more thing complicating or delaying their treatment.
This commission is modeled after Maryland’s unique Health Services Cost Review Commission, which has been setting rates at Maryland hospitals for more than 30 years and is credited with: keeping rates relatively low, saving Medicare billions of dollars, maintaining world-class institutions and small community hospitals alike, and helping to share the risk of uncompensated care across all hospitals. This is a model that we know works here in Maryland and can do much to set fair, affordable rates for families and agencies alike. Setting payment rates for brand and generic drugs is a long and strong tradition in Medicare and Medicaid; the new Maryland approach would strengthen what health programs and health insurers do today, and it protect our pharmacists. Reining in rising drug costs can also help address the rising cost of premiums.
And here’s how it might work: The new treatment to cure Hepatitis C, the leading infectious disease in Maryland, costs $85,000. That price tag is so high that only 20 percent of Marylanders who need it can get it. If the cost to Maryland health insurers, pharmacists and consumers were adjusted so that even 80 percent of Marylanders could afford it, the company would make the same profit. This commission could thereby maximize access and the public health benefit of the cure, and the company could continue to support research and development for medications that deliver innovative solutions to our health care needs. We know Marylanders support our Drug Cost Commission proposal to set fair rates for prescription drugs. A recent poll by OpinionWorks LLC found a strong majority of Marylanders would be willing to switch their vote to a candidate of a different party if that candidate supported this proposal. Organizations like the AARP, NAACP and 1199 SEIU, and local groups across the state have all endorsed this measure, along with Attorney General Brian Frosh.
We’ve made progress here in Maryland, and there is more work to be done. The time is now to pass the Drug Cost Commission bill. It is a strategic, powerful and balanced approach that meets the needs of Marylanders who are struggling to afford their medications and insurance premiums.
Sen. Joan Carter Conway (joan.carter.conway@senate.state.md.us) and Del. Joseline Peña-Melnyk (joseline.pena.melnyk@house.state.md.us) are Democrats and lead sponsors of Senate Bill 1023 and House Bill 1194.