State Drug Price Transparency Programs Identify Critical Data on High Cost Drugs
States’ drug price transparency programs are effectively analyzing and reporting data — an important tool for informing the public, holding drug supply chain entities accountable for high costs, and identifying potential policy approaches. Leading states are highlighting high prices for anti-inflammatory drugs, the impact of pharmacy benefit manager (PBM) regulation on drug spending and the use of rebates, and a discrepancy between prices along the supply chain that reduces the potential savings from decreasing generic costs.
Maine, Washington, and Oregon, three of the 14 states with drug price transparency laws, recently published comprehensive reports analyzing collected data in late 2021 and early 2022. This blog shares some key findings from these reports.
Identifying High Cost Drugs
Drug price transparency laws enable states to identify specific high cost drugs that are creating affordability challenges for consumers and payers. For example, Oregon’s drug price transparency program found that there was more money spent on anti-inflammatory drugs than on any other class in the state, and most of that was spent on AbbVie’s Humira. Anti-inflammatory drugs treat autoimmune conditions, such as arthritis, Crohn’s disease, ulcerative colitis, and plaque psoriasis.
Oregon’s program requires manufacturers to report price increases for drugs with a cost of more than $100 a month that increase greater than 10 percent in the prior calendar year. Although Humira did not meet this threshold in 2021, Oregon’s program looked further into the impact of the drug’s high price because it has been the costliest drug for Oregon’s health system every year since the program began collecting data in 2019.[1]
Oregon’s program also collects patients’ stories on high priced drugs and received submissions about the affordability challenge Humira poses. AbbVie increased Humira’s wholesale acquisition cost (WAC) by 7.3 percent in 2019 and 7.4 percent in 2020, despite no new evidence of safety or efficacy. In total, Oregon carriers reported spending over $153 million on anti-inflammatory drugs in the reporting year.
In Maine, multiple insurers reported that Humira ranked among drugs with the highest plan spending during the reporting year. Similarly, Washington highlighted that drugs treating autoimmune conditions were ranked highest on carriers’ lists of top 25 drugs with the highest net price and top 25 drugs with highest manufacturer rebates retained by the health plan. Other classes of drugs among the highest-priced or with the highest cost increases seen by plans, include those that treat cancer, diabetes, blood clots, and HIV.
Identifying high priced drugs is an essential first step for targeting further efforts to address drug prices, such as establishing a prescription drug affordability board (PDAB). Oregon and Washington are among the six states with PDABs and data emerging from transparency laws will support these new programs. For example, Oregon’s transparency data will inform affordability reviews and policy recommendations for the legislature while Washington’s transparency data will support efforts to establish upper payment limits.
Understanding the Impact of PBM Regulation
Using transparency program data, Maine explored the relationships between PBMs, consumers, and health plans in an analysis of the impact of a 2019 state law which required PBMs to pass rebates on to consumers at the point of sale or for carriers to use retained rebates to offset premium costs. Maine’s transparency program confirmed that PBMs are indeed passing on more savings to plans than before the law went into effect.
The Maine Health Data Organization (MHDO) found that PBMs, on average, retained payments from payers in the form of spread or administrative fees at a rate of 11 percent over what PBMs reimbursed to pharmacies in 2019, before the law went into effect, compared to just 2 percent in 2020 after the law was in place.
The 2019 PBM law also required health plans to count PBM compensation as an administrative cost under medical-loss ratio (MLR) calculations.[2] MHDO found that there was an almost 98 percent correlation between what payers reported as a benefit under the health plan to what PBMs reported as having reimbursed to pharmacies. Before the law went into effect, during 2019, this measure showed only an 88.9 percent correlation. This means that after the law went into effect, plans were more accurately reporting costs associated with providing medical benefits versus administrative costs in compensating their PBM.
Unpacking Prices across a Complex System
Maine’s drug price transparency report identified an unexpected finding: when generic drug prices decrease, payers and consumers may continue paying higher prices. This dynamic is due to the complicated relationship between WAC, the list price set by manufacturers, and average wholesale price (AWP), a benchmark used for pharmacy reimbursement, as well as differentials between pharmacy acquisition costs and AWP-based reimbursement rates for generics versus brand-name drugs. In 2020, about 6% of active NDCs had WAC decreases.
The negotiated price between pharmacies and payers are typically set based on a discount off AWP. For brand-name drugs, AWP is generally a mark-up of 20% above WAC and changes as WAC is changed over time. For generic drugs, AWP is often set as a discount off WAC or AWP for the reference brand product when a drug was first introduced to market. Unlike with brand-name drugs, generic AWP values are not changed as the value of WAC changes over time. This means that while the WAC for generic drugs will differ between manufacturers, the price that payers reimburse pharmacies for, which is highly correlated with AWP, will remain the same even if WAC decreases.
Due to this dynamic, pharmacies are incentivized to buy generic drugs from manufacturers with the lowest WAC to reduce acquisition costs. But payers do not see any benefit from the lower WAC as AWP remains static. Maine found that multisource generic drugs, which made up most of the drugs with price decreases, had an average decrease of 49 percent, but the average amount paid by payers after WAC decreases fell by only 11 percent. After the WAC decreases, AWP for multisource generic drugs had an average markup from WAC of 1,629 percent.
Although it did not highlight the discrepancy between WAC and AWP, Washington showed that reimbursement from the top four PBMs to pharmacies ranged from 0 percent to more than 100 percent of WAC for individual drugs. This aligns with Maine’s findings that pharmacies may be reimbursed at amounts higher than WAC for generics. Some of this disproportionate reimbursement for generics may be used to offset pharmacy losses in case where pharmacies aren’t reimbursed enough to cover brand-name drug acquisition costs.
Public Use of State Drug Price Transparency Program Data
State transparency programs enable states to identify drugs causing affordability challenges to consumers and payers, analyze the impact of PBM regulation, and to better understand pricing across a complex supply chain as described in this blog. Additionally, programs may provide important data sources to the public and researchers. States like Texas and California regularly publish collected price increase and launch WAC data that is accessible for the public and researchers. The Institute for Clinical and Economic Review (ICER) recently announced that it will leverage California’s public data to evaluate whether there is new evidence that could justify manufacturer reported price increases. To learn more about state transparency legislation, review the National Academy for State Health Policy’s state strategy implementation tracker or the Transparency Law Comparison Chart.
[1]According to the research group 46Brooklyn, Humira’s annual median WAC increase rose from 2014 to 2018 when it approached a 9.7 percent annual price increase, before dropping in 2019 and remaining around a 7 percent annual increase in recent years. Since state transparency programs began collecting pricing data, states have seen fewer drug price increases trigger reporting requirements; however, launch prices and overall spending on prescription drugs have continued to increase.
[2] Under federal MLR requirements, health plans must spend 80 or 85 percent of premium dollars on medical care and only 20 or 15 percent on administrative costs.
Washington Joins Leading States in Establishing a Prescription Drug Affordability Board
On March 24, 2022, Washington state joined five other leading states in establishing a Prescription Drug Affordability Board (PDAB) when Governor Inslee signed SB 5532, sponsored by Senator Karen Keiser, into law. Washington’s PDAB, like those already established in Maryland and Colorado, has the authority to limit what payers in the state will pay for certain high-cost drugs following an affordability review.
Because Washington state enacted a prescription drug price transparency law in 2019 (HB 1224) and has an all-payer claims database, the state is well positioned to identify the costly drugs that the PDAB may consider for an affordability review, the first step toward establishing an upper payment limit for state payers. The Board’s work will focus on the costliest drugs: brand name drugs costing more than $60,000 a year or with price increases of 15% or more over the past year, or 50% in the past three years. Biosimilars and generics are also included under specific circumstances. The Board must identify drugs for an affordability review by June 2023 but may not establish an upper payment limit before January 1, 2027. At that time, the Board may set upper payment limits for up to 12 drugs a year.
This session, Washington state also extended a law capping out-of-pocket insulin costs through 2024. The new law also lowered the insulin cap from $100 to $35 a month. In the meantime, the state’s Total Cost of Insulin Work Group plans to convene to identify and pursue strategies to lower the cost of insulin in the state.
More than a dozen states have enacted legislation to cap out-of-pocket costs for insulin and on March 30, 2022, the House passed a federal out-of-pocket cap for insulin at $35 a month (HR 6833). While out-of-pocket caps bring necessary and immediate relief to consumers, additional measures like a state PDAB or federal drug price negotiations, are also necessary to lower the total cost of the drugs for payers.
The National Academy for State Health Policy (NASHP) is tracking more than 250 state bills aimed at lowering drug prices during the short 2022 legislative session. While most of those bills continue to be efforts aimed at regulating pharmacy benefit managers, the middlemen who negotiate rebates with drug manufacturers and pay pharmacy claims on behalf of health plans, there is growing momentum around PDABs. Nine states have 13 PDAB bills this session. Several other states, – including Rhode Island, Maine, Hawaii, and North Carolina – have introduced bills to achieve savings by referencing Canadian drug prices to establish payment rates for state payers. Those bills reflect model legislation released by NASHP in 2020, An Act to Reduce Prescription Drug Costs Using International Pricing.
Washington Demonstrates Cost Savings and Improved Outcomes from Supporting Family Caregivers
Washington has been at the forefront of providing supports to family caregivers, in large part, because state policymakers have been able to demonstrate cost savings and improved quality of life. Washington’s Medicaid Transformation Project proactively supports caregivers of individuals likely to spend down to Medicaid long term services and supports (LTSS). It was designed after Washington’s Family Caregiver Support Program, (FCSP) which assesses caregivers and provides training, respite, and other resources. Robust data collected from these programs demonstrate that Washington’s investments in family caregivers have ultimately contained costs while improving the wellbeing of caregivers and individuals receiving care.
Proven Return on Investment
Washington’s comprehensive Medicaid 1115 waiver program, the Medicaid Transformation Project, has shown a return on investment since its inception in 2017. This waiver has two caregiver support programs: Medicaid Alternative Care (MAC), which serves caregivers of Medicaid-eligible individuals not using Medicaid LTSS, and Tailored Services for Older Adults (TSOA), which supports individuals and caregivers of individuals who are not yet eligible for Medicaid or are choosing to not participate in Medicaid, but likely to eventually need Medicaid LTSS. TSOA and MAC both offer similar benefits for caregivers, including:
- Caregiver assistance with household tasks, respite, home-delivered meals, and minor home repairs
- Training and education
- Specialized medical equipment and supplies
- Health maintenance and therapy supports, such as adult day centers and counseling
The dollar value of the benefits depends on the caregiver’s assessment. Caregivers are eligible for benefits if they receive a screening with TCARE, an evidence-based tool for assessing a caregiver’s own needs. Caregivers can receive up to $4,362 over a six-month period depending on their assessed level of need and care plan. Eligibility is determined primarily by age, income, and assessment, with more flexibility with income and asset limits than traditional Medicaid. Perhaps due to these flexibilities, more individuals and caregiver/recipient pairs have enrolled in TSOA than MAC. Enrollment in the program has been lower than anticipated, in part due to challenges reaching people who do not self-identify as caregivers.
| Eligibility for Medicaid Transformation Project LTSS Initiatives | |
| Medicaid Alternative Care (MAC) | Tailored Supports for Older Adults (TSOA) |
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Washington analysts determine cost effectiveness with a synthetic estimate projection, a method of statistical analysis that compares actual expenditures with projected expenditures if no program had been implemented. Though the waiver is still in progress, data from the first few years show that the program is succeeding in delaying Medicaid LTSS and preventing hospitalizations. Furthermore, survey results find high levels of satisfaction among caregivers and recipients. Washington’s evaluation is largely based on data from TCARE family caregiver assessments combined with data on emergency department visits, inpatient admissions, 30-day readmission rate, nursing home admission rate, and mortality rate.
Prior to the initiation of the Medicaid Transformation Project, Washington used data to demonstrate the cost-effectiveness of expanding its Family Caregiver Support Program (FCSP) in 2012. Under Washington’s FCSP, interested caregivers receive a TCARE screening. Subsequently, eligible caregivers receive support in finding local resources, training on caregiving topics, help with securing respite, and advice and support on specific challenges. This assessment strategy produces a range of data on caregivers and recipients of care and allows the state to establish a baseline from which to study the impact of the program. In an analysis of the FCSP expansion, Washington found that care recipients whose caregivers were screened following FCSP expansion were 20 percent less likely to enroll in Medicaid LTSS in the year post-screening, controlling for other factors. These results identified a return on investment using baseline and implementation data, demonstrating the value of the state’s investment in caregivers and serving as a precursor to the Medicaid Transformation Project waiver.
Multi-Faceted Approach to Support Caregivers and Reduce Medicaid Costs
Washington’s efforts on caregiver supports are multi-faceted to delay the need for Medicaid services. Both Washington’s FCSP expansion and its Medicaid waiver place an emphasis on identifying caregivers in need of support before more formal LTSS are needed and connecting them with resources. These initiatives align with other efforts Washington has taken to support caregivers and older residents, including the state’s Paid Family Leave program and its first-in-the-nation public long-term care insurance program. The combination of these supports, emboldened by robust data demonstrating their effectiveness, forms a cohesive caregiver support strategy that allows Washington to provide LTSS care while spending less per resident on Medicaid LTSS than the national average.
Acknowledgement: Thank you to Susan Engels, Office Chief, Home and Community Services, Washington State Department of Social and Health Services, for presenting much of this information to NASHP’s State Medicaid Policy Institute on Family Caregiving on June 16, 2021. This blog is part of NASHP’s RAISE Act Family Caregiver Resource and Dissemination Center and is supported by The John A. Hartford Foundation.
State Approaches to Extending Medicaid Coverage Beyond 60 Days Postpartum
States have an increasing interest in extending Medicaid coverage from 60 days to 12 months postpartum, driven by states’ priorities for ensuring continuity of coverage and addressing the maternal mortality crisis. To extend this coverage, states can request approval from the Centers for Medicare and Medicaid Services (CMS) under Medicaid Section 1115 demonstrations. Through a new provision included in the American Rescue Plan Act (ARPA), states can now also extend postpartum coverage through a Medicaid state plan option (SPA). Under the SPA option, states must provide full benefits during and throughout the 12-month postpartum period. If a state covers pregnant people through the Children’s Health Insurance Program (CHIP), it must also elect to extend coverage through CHIP. This state plan option is only available for a five-year period starting April 1, 2022.
As described in more detail below, two states – Illinois and Missouri – recently received approval from the Biden Administration for the extension of Medicaid postpartum coverage. Washington State has enacted legislation to extend Medicaid postpartum coverage and will submit a SPA to CMS for this authority. There are another 33 states that have introduced legislation or enacted legislation to seek federal authority to extend Medicaid coverage to 12 months postpartum. Some states are seeking a full coverage extension for all eligible pregnant people, while other states are defining specific eligibility groups, benefit coverage, and length of the extension (i.e., six-months postpartum).
The maternal mortality crisis continues to be a significant challenge across states. More than half of pregnancy-related deaths occur during the postpartum period, or the period following birth, and 12 percent occur after six-weeks postpartum. Black women are three to four times more likely to die from a preventable pregnancy-related complication compared to non-Hispanic white women; women of color also experience higher rates of uninsurance compared to white non-Hispanic women. Lapses in or loss of coverage may exacerbate existing chronic conditions, such as depression and hypertension, which can contribute to poor maternal health outcomes. Churn, or moving between insurance plans or becoming uninsured, can also pose a serious risk to pregnant people by disrupting care and potentially exacerbating existing health conditions. Higher rates of churn and uninsurance among pregnant women are found in states that have not expanded Medicaid under the ACA.
Extending Medicaid postpartum coverage is a key strategy to address maternal mortality and loss of coverage. Currently, Medicaid coverage for pregnant people lasts until 60 days postpartum and individuals are typically disenrolled on the last day of the month. After this period, postpartum people may:
- requalify for Medicaid if they live in a state that has expanded Medicaid and they meet expansion eligibility criteria, including the income requirements,
- requalify for Medicaid if they are a parent with a dependent child and meet eligibility criteria, including the income and age requirements,
- seek private coverage through the individual marketplace, which generally includes premiums and higher out-of-pocket spending compared to Medicaid, or
- become uninsured.
The following describes three states’ efforts to extend postpartum coverage through a Medicaid section 1115 waiver or through a state plan option, as allowed under ARPA.
In May of 2021, CMS approved Illinois’ request to expand full Medicaid coverage from 60 days to 12 months postpartum under a Medicaid Section 1115 demonstration. The goal of this extension of coverage is to reduce health disparities and strengthen continuity of coverage by allowing mothers to stay with their existing providers, prevent gaps in insurance coverage, and provide access to needed care, including behavioral health services and services to manage chronic conditions, such as diabetes and hypertension, during the full postpartum period.
In 2018, Missouri enacted a law allowing the state to seek federal authority to extend Missouri HealthNet (Medicaid) benefits for postpartum women who are diagnosed with a substance use disorder (SUD) within 60 days of giving birth. The state submitted an 1115 Demonstration waiver, which was approved by CMS in March 2021. Women who meet the criteria of the Missouri Targeted Benefits for Pregnant Women Demonstration program will be eligible for SUD treatment, as well as treatment for mental health conditions related to SUD for up to twelve months following delivery. The intent is to improve access to quality treatment for SUD, and mental health conditions related to SUD, for women who recently gave birth. Anticipated results include increased adherence to and retention of SUD treatment plans; reduction in SUD-related hospitalizations and emergency room visits; strengthened safeguards for the health of women and children during the postpartum period and first year of the newborn’s life; and improvement in health outcomes for women and children.
In May 2021, Washington State enacted a law to extend Medicaid postpartum/post-pregnancy coverage to 12 months, with an implementation date of June 2022. The state plans to submit a SPA to CMS, as allowed under ARPA. Under the law, the state will also provide coverage for undocumented individuals who do not qualify for Medicaid coverage but whom are in the window of up to 12 months postpartum. The law will also provide coverage to individuals who had any end of pregnancy outcome.
Promoting continuity of coverage is a critical strategy for addressing the maternal mortality crisis. NASHP expects states to continue pursuing postpartum coverage extensions, particularly through the state plan option under ARPA. For more information on state actions to extend postpartum coverage, visit NASHP’s Extending Postpartum Coverage Tracker, which is updated monthly.
State Policy Actions to Decriminalize Controlled Substances
In the wake of a nearly 30% increase in drug overdose fatalities within a single year, states have been grappling with how to reduce overdose deaths, including exploring new approaches to penalizing the use of substances. Aligning to Biden administration priorities to increase access to treatment services and address racial inequities in drug policy, some state approaches specifically target interventions to respond to disproportionately high numbers of Black and Latinx Americans who are currently incarcerated for drug violations.
Since the fall of 2020, three states have enacted legislation that eliminates criminal penalties for some or all controlled substances, including, for example, methamphetamine, heroin, cocaine, and psilocybin. Some of these laws call for a significant overhaul of the state’s criminal code and revamp of substance use disorder (SUD) treatment infrastructure, while others simply decriminalize threshold amounts of certain controlled substances.
- In November 2020, Oregon was the first state in the nation to decriminalize the possession of small amounts of all scheduled drugs for personal use through policy established by Ballot Measure 110. The law removes barriers to treatment and recovery services for people with SUD and eliminates criminal penalties for drug possession.
- In May 2021, Washington took action by passing a law that similarly removes criminal penalties for drug possession and establishes a comprehensive plan to increase access to and engagement in treatment for SUD.
- In June, 2021, Vermont’s governor signed H. 225 into law, making Vermont the first state to specifically decriminalize possession of non-prescribed buprenorphine. The new law also refers individuals under 21 found in possession if 224 milligrams or less of buprenorphine to a state-run court diversion program, and individuals under 16 found in possession of 224 milligrams or less of buprenorphine to delinquency proceedings in state family court.
Several other states introduced legislation in 2021 to decriminalize possession of scheduled substances that failed to pass. Maine’s proposed legislation died, while proposed measures in New York and Rhode Island were not decided upon before legislative sessions ended or went into recess. Massachusetts’ proposed legislation is still under consideration and will be further discussed at a hearing scheduled for September.
The table below summarizes themes across states with 2020-2021 legislation that decriminalizes at least one controlled substance.
Key features of state drug decriminalization legislation (enacted and proposed)
| NY* | OR | RI* | MA* | WA | VT | |
| Eliminates criminal penalties | X | X | X | X | X | |
| Imposes fine and/or screening | X | X | X | X | X | |
| Tasks/creates a committee with assessment and recommendations | X | X | X | |||
| Establishes a SUD treatment funding plan | X | X | ||||
| Language regarding SUD as a disease | X | X | ||||
| Language regarding ineffectiveness of punitive interventions | X | X | X | |||
| Language regarding social determinants of health/racial equity | X | X | X | |||
| Amends paraphernalia law | X | X | ||||
| Referral to treatment or counseling | X | X | X | X | ||
| Specifically decriminalizes possession of small amounts of non-prescribed buprenorphine | X |
*Indicates proposed legislation
Expanded SUD treatment and recovery services, funding for those expanded services, and impacts on sentencing are emerging as themes in decriminalization policy out of recent introduced and enacted state legislation:
- Oregon will fund existing government and community-based organizations to create Addiction Recovery Centers to provide people who use drugs with both acute care for immediate needs as well as intensive case management and referral services. Expanded treatment services provided in Oregon will be funded through marijuana tax revenue and savings from avoided drug-related arrests, incarceration, and prosecution. This is projected to provide over $100 million for services in the program’s first year.
- Washington will develop a substance use recovery services plan that will connect people with SUD to low barrier treatment and recovery support services. The state has allocated just under $100 million in general funds to provide support to each local behavioral health administrative services organization for the development of recovery navigator programs. Both Washington’s and Oregon’s behavioral health administrative services organizations are also tasked with developing a recovery navigator program, which will be modeled after existing recovery programs and will be responsible for providing community-based outreach as well as intakes, assessments, and connection to ongoing treatment services.
- In tandem with signing H. 225 into law, Vermont’s governor released an executive order, which cites the increase in fatal and non-fatal opioid overdoses, driven by COVID-19, as the impetus for the bill and indicates that decriminalizing buprenorphine is intended to decrease opioid overdose deaths and increase engagement in treatment for opioid use disorder (OUD). The executive order establishes the Decriminalized Buprenorphine Taskforce, which is responsible for assessing the impact of the new law and reporting them back to the governor.
Looking forward
Policy makers anticipate these laws will help address historic overrepresentation of people of color in corrections systems: Oregon estimated that its new law will result in a nearly ninety-one percent overall decrease in convictions with a projected 93.7% reduction among Black Oregonians and 94.2% reduction among Native American Oregonians. Washington’s newly created Substance Use Recovery Services Advisory Committee is tasked with creating recommendations on the collection and reporting of drug possession-related interactions with law enforcement and prosecutors; the Committee will report on racial, demographic, and geographic disparities therein. New York’s proposed legislation acknowledged that Black and Latinx communities have been disproportionately affected by drug criminalization laws, noting that policy change is intended to shift the state’s “approach to drug possession from one based on criminalization and stigma to one based on science and compassion.”
As overdose deaths have continued to rise – both before and during the COVID-19 pandemic – decriminalization represents a shift in how states might address the SUD crisis. New policies have the potential for far-reaching impact not only within state treatment systems but also across courts, pre-trial services, and incarceration settings as well. As these laws take effect, states will be evaluating the outcomes of decriminalization on programs, budgets, and systems alignment, and NASHP will continue to monitor these efforts and their outcomes.
Adding Teeth to Transparency: States Take Stronger Steps Against Drug Price Hikes
Three states have proposed legislation, based on National Academy for State Health Policy’s model law, that penalizes drug manufacturers for hiking prescription drug prices without new clinical evidence to justify the increase.
More than a dozen states have enacted drug price transparency legislation to better understand the extent of and drivers behind prescription drug price hikes. Now two of those states, Washington and Maine,* along with Hawaii, have proposed legislation to take the next step: penalizing manufacturers for hiking prices on their products without new clinical evidence to support a price increase.
The legislation is based on a NASHP model bill that is designed to be easy to administer and a low-cost approach. The model bill enables states to utilize an annual report published by the Institute for Economic and Clinical Review (ICER) that identifies a small number of expensive drugs with large unsupported price increases. ICER’s January 2021 report, for example, revealed that US spending on unsupported price increases for just seven drugs led to increased spending of $1.2 billion in 2019.
The model bill penalizes manufacturers for 80 percent of their drug sales from unsupported price increases in a state – representing millions in potential revenue that can be used to help reduce prescription drug costs for consumers. NASHP can work with states to estimate potential revenue from this legislation.
ICER is an independent organization that conducts methodologically rigorous research into the clinical and economic value of prescription drugs. A growing number of states is looking to ICER’s annual analysis of unsupported price increases because it is thorough and transparent. The report reflects research that would be difficult for states to replicate on their own without a large investment of time and resources.
ICER actively engages drug manufacturers in its unsupported price increase report by giving them opportunities to correct the data ICER uses in its analysis and to present alternative explanations that might justify the price increases under investigation. In some cases, engagement with manufacturers has led to removal of a drug that had been identified as having an unsupported price increase from ICER’s list. While some stakeholders have expressed concern with ICER’s use of quality adjusted life years (QALYs) in its separate analyses determining the value of specific drugs, ICER’s unsupported price increase report does not use or reference QALYs in any form.
ICER’s January 2021 report on unsupported price increases identified well-known, frequently used, and high-cost drugs, such as Humira, which is used to treat autoimmune diseases. Another drug, Enbrel, also used to treat autoimmune diseases, was reviewed by ICER after being nominated by states with drug price transparency laws. States tracking drug price increases knew that Enbrel was a problem – and ICER’s exhaustive review of the clinical evidence on Enbrel confirmed that Enbrel’s price increase was not supported by new clinical evidence. Enbrel’s unsupported price increase contributed to more than $400 million in increased spending across the United States last year.
While drug price transparency laws help states detect and report on price increases, NASHP’s Unsupported Price Increase model bill enables states go further to more aggressively discourage price increases and to recoup spending lost to manufacturers that raise their prices – not because their products are in any way improved – but because they can.
NASHP has developed a template for determining potential revenue from penalizing manufacturers for unsupported price increases and can work with states that want to estimate potential total revenue from implementing unsupported drug price penalties in their states. Please contact Jennifer Reck for more information.
*Maine lawmakers have pre-filed this bill, meaning it has been proposed but has not yet been published as a legislative document by the Maine’s Revisor of Statutes.
For individuals living with complex, often chronic conditions, and their families, palliative care can provide relief from symptoms, improve satisfaction and outcomes, and help address critical mental and spiritual needs during difficult times. Now more than ever, there is growing recognition of the importance of palliative care services for individuals with serious illness, such as advance care planning, pain and symptom management, care coordination, and team-based, multi-disciplinary support. These services can help patients and families cope with the symptoms and stressors of disease, better anticipate and avoid crises, and reduce unnecessary and/or unwanted care. While this model is grounded in evidence that demonstrates improved quality of life, better outcomes, and reduced cost for patients, only a fraction of individuals who could benefit from palliative care receive it. 
