Thanks to a bill signed into law today by Gov. Jared Polis (D-CO), Colorado is the first state in the country to give a nonpartisan board the authority to set upper price limits on the most expensive prescription drugs and to require all insurers to apply the rates in their coverage.
The Prescription Drug Affordability Board (PDAB) will consist of five non-partisan health care experts who have the power to set upper payment limits on the most expensive prescription drugs, make recommendations to lawmakers about prescription drug prices, and investigate price increases.
“There’s no silver bullet to fix it all, but this bill is a big step forward in helping reduce the cost of prescription drugs and save Coloradans money,” Polis said at the signing, which took place at the west steps of the state Capitol.
Colorado is the third state in the U.S. to establish a PDAB.
State Sen. Julie Gonzales (D-Denver), one of the prime sponsors of the bill, said her motivation for supporting a PDAB came from conversations she had with members of her community.
“When I heard from my constituents who were telling me their stories about their fear of going to the doctor because they thought, ‘Why would I go to the doctor when the doctor is just going to prescribe me something that I can’t afford,’ I realized that we had to do something,” Gonzales said.
Polis signed the bill in front of a group of legislators, patients, health care advocates, and health care workers who had been fighting for the creation of a PDAB in Colorado for, in some cases, years.
“I’m proud of the folks here,” Gonzales said. “The patients, the advocacy organizations, the health care experts, the legislators, we did the work to make history in the state of Colorado. And with the passage of the bill, with Governor Polis signing it into law, I’m excited to go back to my community and say, ‘Y’all, we did it.’”
Adam Fox, deputy director of the Colorado Consumer Health Initiative, a health care advocacy group that supported a PDAB for Colorado, was in the crowd behind Polis at the Capitol and provided a statement explaining how the Board can help consumers.
“This PDAB will bring relief to Coloradans struggling with high prescription drug costs,” Fox said. “The Board will speak for them and push back against the drug corporations when they try to randomly jack-up rates on unaffordable prescriptions.”
Even before the COVID-19 pandemic, nearly one in three Coloradans reported skipping doses or not filling a prescription because they couldn’t afford the cost. Research from CCHI showed that a PDAB would be able to save Coloradans as much as 75% on the current costs for the most expensive prescription drugs.
Dr. Allison Costello, a family medicine resident in Denver and a member of the Colorado Chapter of the Committee to Protect Health Care, a nationwide health care advocacy group, explained the dire need of reining in the cost of prescription drugs.
“No patient should have to choose between paying for life-saving medication and paying for groceries for their family,” Costello said. “Thanks to this legislation, Coloradans will have more affordable access to these prescriptions, and countless lives will be saved. We applaud Colorado legislators for putting the health and wellbeing of our patients — and all Coloradans — first.”
The PDAB bill faced strong opposition from conservatives and pharmaceutical firms, but also had support from public rallies that featured patients and health care workers demonstrating for a Colorado PDAB.
Also, more than 70% of Coloradans said they would support the creation of a PDAB.
Pharmaceutical Research and Manufacturers of America (PhRMA), a group representing companies in the pharma industry, lobbied heavily against a PDAB, arguing that limiting prices could make it more difficult for patients to access the medicines they need.
“Creating a board of unelected bureaucrats with the authority to arbitrarily decide what medicines are worth and what medicines patients can get would be a disaster for patients,” Hannah Loiacono, a spokesperson for PhRMA, said. “Now, more than ever, Coloradoans should have affordable access to the health care they need. Rather than focusing on dangerous policies that could jeopardize patients’ access and future innovation, policymakers should pursue common-sense policies that would put savings directly in patients’ hands.”
Jennifer Jones Paton, president & CEO of the Colorado BioScience Association (CBSA), a group representing bioscience companies in the state also opposing a Colorado PDAB, echoed Loiacono’s concerns in a statement.
“We support policies that improve coverage, allow patients to receive groundbreaking treatments, and return savings directly to patients. This legislation does not achieve those goals,” Jones Paton said. “State-mandated payment limits would adversely impact health care providers in our state, limit patient access to the very medicines subjected to the UPL, and diminish the ability of Colorado life sciences companies to raise money to fund research, development, and commercialization of new therapies.”
The Colorado Option
At the same ceremony, Polis signed into law the Colorado Option, a bill that started out as a public option for health care coverage and transformed significantly into a mechanism to drive down health insurance premium costs by 18% over the next three years.
“Tonight, Colorado families — especially those facing sky-high costs of the most expensive drugs and those buying insurance on the small-business and individual markets — will sleep a little easier thanks to the Colorado Legislature and Governor Polis,” Fox said. “These two major policies, with many other amazing bills this session, cement Colorado’s leadership in health care.”