Issue 2 could increase costs for veterans
If passed, Issue 2 would require Ohio’s state agencies to pay no more for prescription drugs than the lowest discounted price paid by the U.S. Department of Veterans Affairs (VA). This outcome sounds too good to be true … because it is.
Experts agree that if these special discounts were actually extended beyond veterans, prices could increase for 339,000 Ohio servicemen and women and millions more nationwide.1 Here’s why:
- Department of Veterans Affairs: In a 2016 issue briefing about proposals like Issue 2, the VA estimated a $3.8 billion annual increase in prescription drug costs for the VA if the proposal were to become law in any state.2
- The U.S. Government Accountability Office (GAO): The GAO has on several occasions examined the issue of extending VA discounts to other programs and warned that a mandatory extension could undermine the VA’s ability to obtain favorable pricing for drugs and limit the availability of some medications to the VA. In 2000, the GAO advised against including Medicare in the VA’s pricing structure for this reason.3
1U.S. Department of Veterans Affairs, State Summary, Ohio, accessed August 9, 2017, https://www.va.gov/vetdata/docs/SpecialReports/State_Summaries_Ohio.pdf
2 4 California Legislature Joint Committee on Rules, Letter to Bell, McAndrews and Hiltachk and attached “VHA Issue Brief,” August 19, 2016
3U.S. Government Accountability Office, September 1991, Medicaid: Changes in Drug Prices Paid by VA and DOD Since Enactment of Rebate Provisions, accessed May 19, 2017, https://www.cbo.gov/sites/default/files/104th-congress-1995-1996/reports/1996doc20.pdf