Governor Signs bill to Reform Rx Drug Marketing and Control Health Care Costs

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Governor Signs bill to Reform Rx Drug Marketing and Control Health Care Costs


Governor Patrick signed the Health Care Cost Control Bill that will begin to rein in aggressive and inappropriate marketing tactics by drug companies and medical device companies.  Those excessive marketing tactics have resulted in excessive prescription drug costs and compromised care.  Direct-to-physician industry marketing promotes the prescribing of expensive drugs in place of equally safe and effective lower-cost drugs and the prescribing of newer brand name drugs that have the least safety and efficacy information. The excessive marketing of Vioxx, for example, led to the prescribing of a new drug that ended up causing unforeseen heart problems that killed 40,000 people.

“The new law includes common sense consumer reforms which will enhance health care quality and begin to control costs through efficiency and transparency,” said Deirdre Cummings, Legislative Director for MASSPIRG. “The law makes a giant step forward in shining the light rx drug marketing practices by drug and medical devise companies through the disclosure of anything of more than $50 value, giving the DPH authority to ban some gifts and issue fines for non-compliance.”

“The Governor, Senate and House should be commended for their leadership and determination to protect consumers and enhance our health care system,” continues Cummings.   

The final bill also included the following cost control reforms:

RX Drug Marketing Regulations: Requires pharmaceutical and medical device companies to disclose payments to health care providers of $50 or above to DPH which will make the disclosures publicly available. Directs DPH to establish regulations on pharmaceutical and medical device marketing, using the industry’s own Code as a minimum standard, and establishes a $5000 penalty for violation, enforceable by the Attorney General.

Creation of an Academic Detailing Program:  A much needed counterweight to the industry’s commercial detailing and gift-giving marketing efforts.  Academic detailing programs are cost-effective ways to improve physician prescribing behavior and so reduce health care costs:  Based on other states’ experiences with academic detailing programs, Massachusetts can expect to save two to three dollars for every dollar we spend on academic detailing.

Use of Uniform Claim Codes:  Currently, nearly one-third of all dollars spent on health care go toward administrative costs – and much of that is wasted on managing the tangle of bureaucratic claim codes created by different insurance plans.  Conservative estimates project that the adoption of uniform claim codes will save Massachusetts hospitals over $50 million annually in administrative costs.

Public Reporting of Healthcare-Associated Infections and Serious Reportable Events:  Requires facility-specific public reporting of infections, as already required in twenty-two other states and the reporting of, and allows for the nonpayment for, serious reportable events.

Taken together, these provisions will begin to contain the cost of health care in the commonwealth helping Massachusetts citizens continue to have access to affordable health care.