Ohio Bans Pharmacy 'Gag Orders' To Help Save Money

Apr 5, 2018

Ohio regulators are telling insurers not to enforce "gag orders" that stop pharmacists from telling customers about lower prices on prescription drugs.

The Ohio Department of Insurance’s Jillian Froment says sometimes these gag orders mean pharmacists don’t disclose potential cost savings.

“Contracts they have with pharmacy benefit managers prevent them from letting a consumer know that there is a cash option available that would be less expensive than using their insurance card to cover their pharmacy benefit,” she said.

Froment says state regulators are now ordering insurers and pharmacy benefit managers, who act as middlemen in the process, to tell Ohioans if they could save money by opting for a lower priced drug and paying cash.

Ohioans who go to the pharmacy to pick up prescriptions sometimes are forced to pay more out of pocket with their insurance card than they would have if they didn’t have coverage. State regulators are also prohibiting that practice, too. 

Some Ohio lawmakers are also pushing for a bill to allow the state auditor to review contracts between pharmacies and benefit managers.

The changes come after The Columbus Dispatch reported that independent pharmacists say CVS Caremark is overcharging taxpayers and driving out retail competition.

The pharmacists say the company is paying lower rates to pharmacists who fill prescriptions for Medicaid patients and keeping the savings.

CVS Caremark denies that such arrangement exist in their agreements with local pharmacists. A company official also says it does not prevent pharmacies from talking to their patients about the availability of lower drug prices.