Insurers foil efforts to find drug savings

Competition among health-insurance companies, a perennial hot topic on Utah's Capitol Hill, has stymied efforts by state auditors to identify possible cost-savings measures for state prescription drug purchases.

The Legislative Auditor General's Office was unable to fully complete a requested audit because much of the necessary information was deemed proprietary and was therefore inaccessible to auditors, according to a report released Wednesday.

Meanwhile, at least three different pieces of legislation presented to lawmakers Wednesday seek to require participants to release previously unavailable information.

The audit sought to evaluate prescription drug purchases by state entities, many of which purchase their drugs through private insurance companies. These private insurers declined to provide key data, such as discounts and rebates provided by pharmaceutical companies, the report said.

"The carriers feel that granting the audit team access to the cost data would undermine their ability to be competitive in the industry," the report said.

The private insurers also reported that, in some cases, pharmacy costs are unknown because they are included in overall medical-benefit costs.

The Auditor General's Office sought the advice of attorneys from the Office of Legislative Research and General Counsel, who said that, because the information is held by private companies, auditors have no legal right to the data.

The report indicated that lawmakers could attempt to force insurers, through legislation, to make information regarding prescription drug costs available to state entities during bid processes. However, the report noted, such efforts "could prove problematic," based on the private insurers' reactions to their inquiries.

"Some insurance providers have said they would not provide this information under any circumstances, because it would limit their ability to be competitive."

At a Wednesday afternoon meeting of the Health and Human Services Interim Committee, however, legislators discussed efforts to require Utah hospitals and insurers make other cost information available to consumers.

The committee unanimously endorsed a bill sponsored by Rep. Michael Morley, R-Spanish Fork, to allow the Utah Department of Health to collect health-care cost and quality data, which could eventually be used to compare services at area hospitals.