NEWS: Legislation Signed to Regulate the Middle-Men Between Pharmacies and Insurance Companies

Rep. Guttenberg’s House Bill 240 Will Save Alaskans Money by Eliminating Insurance Company “Gag Orders” on Local Pharmacies

Anchorage – A landmark piece of legislation to empower local pharmacies in Alaska was signed into law this morning by Alaska Governor Bill Walker during a ceremony at a small pharmacy in Juneau. Representative David Guttenberg (D-Fairbanks) responded to the concerns of pharmacists and many of their customers by sponsoring House Bill 240, which passed the Alaska State Legislature this year with unanimous support.

HB 240 regulates pharmacy benefit managers (PBMs), which serve as the middle-men between local pharmacies and insurance companies. One of the most significant provisions of the bill eliminates the use of “gag orders” by health care companies and prescription drug manufacturers to prevent local pharmacists from informing customers that they can save money by paying for some prescription drugs with cash rather than using health insurance.

“Health care costs, including the cost of prescription drugs, continue to skyrocket nearly out of control. This is especially true in Alaska where we pay some of the highest health care costs in the nation. Big money lobbyists and the insurance companies they work for have fought for nearly a decade to prevent a bill like House Bill 240 from passing. We got this bill across the finish line this session because saving Alaskans money on health care costs is not a partisan issue, it’s an Alaskan issue,” said Rep. Guttenberg. “I am especially pleased that we are getting rid of the preposterous gag orders imposed on pharmacists that prevent them from telling Alaskans how and when they can save money on prescription drugs.”

In addition to eliminating the use of gag orders, HB 240 clarifies how pharmacies in Alaska can be audited by pharmacy benefit managers. During the process to develop and pass HB 240, Rep. Guttenberg learned of several instances of unfair audit practices. HB 240 clearly outlines how audits are to be conducted, so they are fair and not arbitrary. The bill also requires pharmacy benefit managers to register with the state and sets procedures they must follow when conducting audits.

House Bill 240 passed the Alaska House of Representatives by the unanimous vote of 40-0 in April of this year. The Alaska State Senate unanimously passed the bill in May by a vote of 19-0. Alaska Governor Bill Walker signed HB 240 into law this morning during a ceremony at Ron’s Apothecary Shoppe in Juneau.

For more information, please contact Alliana Salanguit in Rep. Guttenberg’s office at (907) 456-8172.