In today’s highly regulated and byzantine healthcare environment, patients face many challenges accessing life-saving medications. One solution created by state governments is the Prescription Drug Affordability Board or PDAB. These are government-appointed bodies tasked with reviewing and addressing the high cost of prescription drugs. Sounds good! The problem is that PDABs are often made up of health officials and stakeholders who might have conflicts of interest or too little experience in patient care to arrive at sound policy.

Another problem is the focus of these Boards. Many are principally convented to save money that states would expend on drugs, not patients. PDABs have legislative approval to create arbitrary price caps, called upper payment limits (UPL), based upon their determination of “patient affordability.”  This price limit only applies only to purchasing the medication by state entities — PBMs, pharmacies, hospitals, physicians, and others — but not what consumers pay out of pocket. The current model legislation in Virginia provides no accountability or oversight of the PDABs. It also fails to require the board to include or engage patients and prescribers or monitor the impact on patients of its UPL implementation.

While nine states have passed legislation, only 3 PDABs (Colorado, Oregon and Maryland) are active and none have implemented their programs. Other states are still in various stages of planning. Some state PDABs can not only conduct affordability reviews, but they have the authority to implement UPLs on drugs they deem “unaffordable.”

PDAB Limitations

• Board UPLs can only set limits on what insurers or the state pay for a drug
• Boards cannot cap patient out-of-pocket costs; they also cannot require that insurers set patient costs based on the UPL or pass along the discounted price to patients
• Board changes apply to commercial, state, and Medicaid programs, but have little to no impact on federal programs like Medicare

Many of our patients require costly drugs, such as those used to manage inflammatory bowel disease and liver disorders. This legislation could affect availability of these drugs in the Commonwealth. The Virginia Gastroenterological Society is supporting the Medical Society of Virginia’s effort to follow this issue closely as it moves through the state legislature in Richmond.

 

The Virginia legislation can be found at the LIS here: SB 274 Prescription Drug Affordability Board; established, drug cost affordability review, report.

 

Additional Sources

“Putting Patients First in Drug Affordability and Access” by Maimah Karmo  Available here