Lawmakers are to decide today whether the state should know what it is doing when it enters into multi-million dollar health care contracts. You might think there would be little debate about this, but there is, with some legislators apparently timid about asking whether a contractor had conflicts of interest in serving the state. They should overcome their fears and recognize that health care negotiations are not an occasion to be shy.

Three related disclosure bills under the lead sponsorship of Sen. Sharon Treat are scheduled for today. They represent a nationwide frustration over rising drug prices and are reflections of bills in several other state legislatures. Two of the Maine bills stand a good chance of passing – LD 102, which requires the retail price of a drug be disclosed at the time of sale, and LD 254, which requires drug manufacturers to tell the state how much they are spending on marketing and advertising. The third faces more of a fight and, not coincidentally, would provide more of a direct benefit if passed.

LD 554 establishes fiduciary duties and reporting requirements for pharmacy benefit managers, who negotiate drug prices for groups of insured clients. Using volume purchases to barter for lower prices, PBMs can save clients considerably on prescription drugs. But in part because drug prices are so fluid – necessitating a bill like LD 102 – PBMs also find themselves in contracts and side deals with drug manufacturers, pharmacy chains or insurance plans and as a result may have more than one goal in reaching a price for prescriptions. For instance, Sen. Treat reports on one study that estimates 10 percent of the $161 billion spent in 2002 on drugs nationally ($700 million in Maine) went to side deals and undisclosed payments to PBMs. The Maine State Employees Union is about to enter into a $40 million contract with a major PBM. If the 10 percent figure holds up, it means that the PBM will make a quiet $4 million on the side from the contract. Should Maine know the details of this to see whether it influences the kind of deal it is being offered?

Some of the opposition to LD 554 may come from a misunderstanding that a prescription drug is like any other product – a car or a pair of shoes – and that the state has no business looking into how the companies that make them spend their money. They aren’t, and have special patent protections to ensure that they are not treated like other manufacturers. Besides the enormous amount of tax-funded research devoted to medicine, which drug companies can then build on to produce their important products, a consumer cannot take drugs for a test drive, comparing a dozen models and then make a fairly well-informed choice about which seems best. With drugs, often there are a limited number of choices and no practical way for the average person on her own to make what could be a life-and-death choice.

By requiring that PBMs provide fiduciary duties and report on straightforward consumer information and other agreements they have made, Maine consumers will be able to make better choices about which PBM to use and under what conditions. LD 554 is a sensible way for people to understand – and trust – what they are buying.