Maryland’s First-in-Nation Prescription Drug Affordability Board Law (HB768)
by Vincent DeMarco and Susan Olsen
July 12, 2019
Marylanders across the state are struggling to afford the prescription drugs they need, often having to choose between their medication and other necessities, like rent and groceries. As prescription drug costs continue to soar, the Maryland General Assembly acted by taking the first step to ensure that all Marylanders have access to affordable medications by creating a prescription drug affordability board.
Having a specific board that examines any sharp increases in the prices of prescription medications has worked in other countries in which medication prices are significantly lower than in the U.S. The board of appointed individuals considers a broad range of economic factors when recommending and setting appropriate payment rates for reviewed drugs, including a review of the entire supply chain. It allows pharmaceutical manufacturers the opportunity to justify existing drug costs and takes that into consideration as it thoroughly monitors, assesses, and offers recommendations on ways to mitigate the impacts of high prescription drug prices on citizens and their health care systems.
During the 2019 legislative session, the Maryland General Assembly passed HB 768 – which became law effective July 1 without Governor Hogan’s signature – to create such a prescription drug monitoring board like the ones that are working overseas. (See http://healthcareforall.com/2019/07/marylands-path-to-a-prescription-drug-affordability-board/) This will be an independent body with the authority to evaluate expensive drugs and recommend appropriate methods for addressing these costs, including setting upper limits on what Marylanders would pay for them.
The prescription drug affordability board would look at prescription drugs with costs that greatly impact Marylanders, including medications that impact the budgets of state, county and local government programs and facilities. Skyrocketing costs can prevent Maryland patients from accessing the prescription drugs they need, cause significant affordability issues for the state, and threaten public health.
Beginning in 2022, with the approval of the Legislative Policy Committee of the Maryland General Assembly, the prescription drug affordability board may begin to set upper payment limits for prescription drugs purchased by state, county, or local governments. In December of 2023, the board would recommend whether the General Assembly should pass legislation to expand upper payment limits to all purchases of prescription drugs throughout the state.
The proposed board will be composed of five members (plus a Stakeholder Council and staffing support) appointed by the following: one member by the Governor, one by the Senate President, one by the Speaker of the House, one by the Attorney General, and the Board Chair to be jointly appointed by the President and Speaker.
The board would review prescription drugs that meet any of the following criteria:
· New brand name prescription drugs which enter the market at $30,000 or more per year or course of treatment;
· Existing brand name medications which increase in price by $3,000 or more per year or course of treatment;
· Existing generic medications which increase in price by 200% or more per year or course of treatment; and
· Any prescription drug that creates affordability challenges to the Maryland health care system, including patients.
Between enactment and 2024, the board would hire staff, establish upper payment limit methodology, identify sources of public information about industry costs and market pricing practices, enter into agreements with other states already collecting manufacturer-reported data, and recommend ways to make prescription drugs more affordable in Maryland.
Maryland will be the first state to have such a board, and this is considered a tremendous legislative achievement. However, there is more work to do in terms of creating a more effective prescription drug affordability board. The bill originally included all Maryland patients, but the bill that passed only includes state, county, and local government employees. Please be prepared to roll up your sleeves in January of 2020 to enhance this legislation! For more information on legislative issues affecting healthcare in Maryland such as this one, please visit www.healthcareforall.comor call Vincent DeMarco at 410-235-9000 or email firstname.lastname@example.org.