Just before 2023 came to a close, the U.S. House of Representatives passed a bill that would make pricing practices in the health care system more transparent.
The Lower Costs, More Transparency Act (HR 5378), which has bipartisan support, aims to make health care more affordable in part by unveiling hidden pricing options.
If HR 5378 became law as it’s currently written, it would:
- Require hospitals, diagnostic laboratories, imaging service providers and ambulatory surgical facilities to list their prices publicly. In most cases, these published prices must include cash prices (the amounts facilities charge patients without insurance) and the lowest and highest prices the facilities have negotiated with insurance companies.
- Ensure that patients with Medicare, and the federal government’s Medicare program itself, pay the same rates for medications administered by doctors in hospital-owned outpatient centers as patients pay when such medications are administered in doctors’ offices.
- Clarify that laws banning pharmacy “gag clauses” — that is, bans on pharmacists telling patients about lower-cost drug options — apply to all private health plans.
- Ban pharmacy benefit managers (PBMs) that contract with Medicaid managed care organizations from using spread pricing — which is when a PBM charges patients more for medications than the PBM paid and keeps the difference as profit. This practice inflates prescription drug prices for patients.
The bill would also require the U.S. Food and Drug Administration (FDA) to give new generic drug applicants more information about the differences between the brand-name version of a drug and a proposed generic version, in terms of both ingredients and amounts of ingredients.
That would make it easier for creators of new generic drugs to get their drugs approved by the FDA, which could in turn increase the number of generics on the market.
The next step for HR 5378 is to get approved by the Senate. If that happens, it then would go to the president to be signed into law.
There’s no clear timeline for how long that may take. But the fact that the legislation passed the House with broad support from both political parties bodes well for its odds of passage by the Senate — assuming it makes it to a Senate vote.
In the meantime, if you want to let your senators know how you feel about HR 5378, contact them.