Price transparency legislation seeks to shed light on the various costs that contribute to the price of medications. However, due to variations in pricing from negotiated discounts, benefit structures, differing coinsurance, and patients’ specific needs, price transparency legislation is an ineffective way to gauge medication prices. Instead, such legislation can have unintended consequences for consumers. For example, consumers who use price comparison tools created by transparency legislation may request more expensive treatments because they think higher prices imply higher quality care. Additionally, drugmakers may be pressured into controlling prices incorrectly, which can result in nationwide drug rationing. Pricing legislation may also hamper medical innovation and undermine competition, both of which factor in driving down prices for consumers. Finally, if large pharmacies learn of increased drug prices, they may stock up on less costly alternatives, creating shortages of medications and, again, lead to increased drug prices.
Nevertheless, states have begun to introduce price transparency legislation. Please click on the map below for information about legislation introduced this session.