Will appear on the ballot as “STATE ISSUE
2: To require state agencies to not pay more for prescription drugs than
the federal Department of Veterans Affairs and require state payment of
attorney fees and expenses to specific individuals for defense of the law”
Prohibits the state from buying any
prescription drug from a drug manufacturer for a price over the lowest price
paid for the drug by the United States Department of Veterans Affairs (VA).
(Proposed
by Initiative Petition)
A YES vote
means approval of the Act.
A NO vote
means disapproval of the Act.
If
approved, the proposed Act will take effect immediately after Election Day.
League
Explanation of Issue 2:
The Ohio Drug Price Relief Act
Issue 2 would limit the amount the state
and state agencies could pay for prescription drugs. This Act is designed to
restrict the amount that any state agency could pay for drugs, tying it to the
price paid by the VA (Veteran's Administration). The VA negotiates drug prices
with companies and typically pays 20 to 24 percent less than other agencies for
prescription drugs. Specifically, it would forbid state agencies to enter into
any purchasing agreement with drug manufacturers unless the net cost of the
drug is the same or less than that paid by the VA.
State agencies would not be allowed to pay
more than the VA pays for a particular medication. These state agencies
include, but are not limited to, the Ohio Department of Aging, the Ohio
Department of Health, the Ohio Department of Insurance, the Ohio Department of
Jobs and Family Services, and the Ohio Department of Medicaid (the program for
people with low incomes or disabilities).
The bill will only impact those who
receive drugs paid for by the State, not those with any other type
of coverage. If adopted, the proposed statute would affect only those
associated with the above mentioned state agencies - roughly 4 million Ohioans.
The Act would not apply to those who use private insurance, Medicare, or other
non-state-provided coverage - approximately 7 million Ohioans.
In addition, Issue 2 requires the state to
pay sponsors’ attorney fees and expenses. It gives the sponsors, the four
individuals responsible for circulating the petition to place the issue on the
ballot, the right to defend legal challenges to the law. It will require the
Attorney General to defend the law if challenged in court. It also says that
should the court find Issue 2 is unenforceable, the petitioners would be fined
$10,000.
Pros:
1.
Drug
costs are the main driver of rising health care cost. There is an urgent
need to control costs while maintaining access to needed medications.
2.
Too
many Ohioans must choose between the basic necessities of life and paying for
their medications.
3.
There
is an indirect benefit to taxpayers as the state would save an estimated $400
million per year on drugs. This could free up some substantial money that the
state could use for other programs.
4. Ohio Attorney General Mike DeWine has indicated he
will defend the law from the inevitable lawsuits so the petitioners will not
need taxpayers to pay attorney fees.
Cons:
1.
The
Act does not define some important terms, such as “drug,” “state,” “ultimate
payer,” and “net cost.”
2.
The
Act does not address pricing of drugs that are not purchased
by the VA and creates costly, complex purchasing arrangements.
3.
Pharmaceutical
companies might respond to passage of the Act by a) negating existing discounts
and rebates, b) raising prescription prices charged to non-covered entities and
individuals, and/or c) raising prices charged to the VA.
4.
Requires
Ohio taxpayers to pay the sponsors’ attorney fees and expenses, win or lose,
and sets no cap on the total amount of attorney fees and expenses.
PROPONENTS: Yes on Issue 2, also known as Ohio
Taxpayers for Lower Drug Prices, is leading the campaign in support of
the initiative.
OPPONENTS: No on Issue 2, also known as Ohioans Against the Deceptive Rx Ballot Issue, is leading the campaign in opposition to
the initiative
******************************************************************
Further
Information:
A similar proposition (Proposition 61)
appeared on the California ballot in 2016. It was defeated. More information
on California Proposition 61.
Analysis from
Case Western Reserve University professor commissioned by
Ohio Taxpayers for Lower Drug Prices, the campaign supporting the proposal.
Analysis from Vorys
Healthcare Advisors commissioned
by Ohioans Against the Deceptive Rx Issue, the
campaign opposing the proposal.