President Trump Signs Prescription Drug Gag Clause Legislation

On Wednesday, President Trump signed into law S. 2553, the Know the Lowest Price Act, and S. 2554, the Patient Right to Know Drug Price Act. The legislation was passed by the House and Senate last month with bipartisan support and will ban “gag clauses” that prevent pharmacists from telling customers when they can save money on their prescriptions by paying out of pocket for the retail price of the drug, rather than using their insurance and making the co-payment. These bills comprise portions of President Trump’s “America First” prescription drug initiative that were released as part of a blueprint to lower drug prices in May.

S. 2554 applies to private plans and would ban health insurers and group health plans from preventing pharmacists from telling consumers that it would be more cost effective to pay out of pocket, as opposed to paying their insurance co-payment. Meanwhile, S. 2553 addresses patients covered under Medicare Part D and Medicare Advantage plans and prohibits a prescription drug plan under Medicare from restricting a pharmacist from providing complete price information for a medication to a beneficiary.

The passage of both bills comes after multiple states had already taken action to stop the practice. Connecticut, Georgia, Maine and North Carolina passed legislation last year banning the practice of gag clauses. The success of these bans set the stage for 10 other states around the nation to introduce bills, which ultimately acted as a catalyst for federal legislation.

As always, if you have any questions about your drug coverage, please feel free to give us a call, here at Total Benefit Solutions, Inc at 215-355-2121