Pharmacists and Seniors Say Goodbye to “Gag Clause” and Hello to Lower Drug Costs

Pharmacists finally will be free to disclose lower prices for prescription drugs, thanks to a new law introduced by Senator Debbie Stabenow (D-MI), which was endorsed by the National Committee to Preserve Social Security and Medicare. The Know the Lowest Price Act was signed into law by President Trump Wednesday after receiving bipartisan support in Congress. It blocks Medicare Part D insurers and pharmacy benefit managers from restricting a pharmacist’s ability to tell beneficiaries that certain medications may be cheaper when purchased out of pocket than by going through their insurance plan.

“The passage and signing of Senator Stabenow’s legislation proves that Congress and the president are indeed capable of coalescing around common sense solutions to lower prescription drug prices. This law will particularly help seniors on fixed incomes struggling to afford the medications they need,” said National Committee President and CEO Max Richtman.

Before Sen. Stabenow’s legislation was enacted, some insurers and pharmacy benefit managers imposed ‘gag clauses’ on pharmacies which prevented them from sharing information about cheaper prices. For example, a diabetes or high blood pressure medication may cost $20 through insurance coverage but only $8 by paying out of pocket. A recent report found that customers overpaid for prescription drugs at the pharmacy counter more than 20% of the time.

“We hope to see continued bipartisan cooperation as other bills to save Americans money at the drug counter work their way through Congress, including the Lower Out of Pocket Costs for Seniors Act and the Affordable and Safe Prescription Drug Importation Act, among others,” Richtman said.