Pa. legislators pass bill designed to help community pharmacies stay in business, regulate 'middlemen'
The community pharmacies’ owners said the closures were forced by years of low reimbursements paid by pharmacy benefit managers, or PBMs, widely described as the “middlemen” between health insurers and pharmacies.
Pharmacist
“It’s happened all around us,” he said. “We are hoping we are not next. We are living it every day. Reimbursements are not lucrative enough to stay in business.”
The
“This is one of, if not the, most significant pieces of legislation passed by the state legislature this year,” Benham said Friday as the bill awaited a signature from Gov.
State Rep.
PBMs sit at the nexus of drug manufacturers, health insurers and pharmacies – getting rebates from drug manufacturers for placing a specific drug on a health insurance plan’s formulary, and paying pharmacies on behalf of health insurance providers for drugs dispensed to patients.
But those payments, or reimbursements, for medications that PBMs set for pharmacies rarely cover the wholesale price that a pharmacy pays to stock them – unless that pharmacy is owned by the PBM, according to an ongoing report from the
Last week, as Benham’s bill moved through the final stages of Pennsylvania’s legislative process, the
The findings suggest PBMs may be doing the same for other drugs, bolstering what community pharmacists have said for years.
Those three PBMs have become vertically integrated over time, owning pharmacy chains and managing 79% of prescription drug claims for approximately 270 million people.
The commission’s study is ongoing, but the initial analysis can inform state and federal policymakers who are also scrutinizing PBMs, it said.
Benham’s bill, passed with bipartisan support from state lawmakers and waiting only for Shapiro’s signature as of Friday in order to become law, is the product of 18 months of research and six months of traveling across the state to meet with pharmacists, she said.
Although the state
“We’ve been waiting for years for this kind of reform,” Martella said.
The bill prohibits a PBM from reimbursing a retail pharmacy an amount less than the amount that the PBM reimburses a PBM-affiliated pharmacy.
It also bans PBMs from requesting that pharmacies pay back the entire amount of money for a medication dispensed because of “scrivener’s errors,” or paperwork mistakes discovered during audits that don’t affect the patient’s receipt of their prescribed medication.
The bill also prohibits “clawbacks,” which is another way PBMs can charge pharmacies without much transparency, through reconciliations months after drugs are dispensed.
The bill establishes network adequacy, requiring a PBM to provide a reasonable and accessible retail pharmacy network under a health benefit plan that provides convenient patient access, and that network cannot be limited to PBM-affiliated pharmacies only.
“Patient steering,” or requiring health plan members to purchase pharmacist services exclusively through mail-order pharmacies or a PBM retail pharmacy affiliate, is also prohibited by the bill.
A provision for transparency is also included. Starting next July and each year after, PBMs must submit a report to the state detailing the aggregate amount of all rebates the PBM received from pharmaceutical manufacturers for all its health insurer clients, as well as administrative fees that the PBM received from manufacturers and health insurer clients. PBMs must also report the amount of money or rebates they received from drug manufacturers that they did not pass through to health insurer clients.
Benham said she has scheduled a press conference Friday in
More than 70 pharmacies have closed in
Burns, state Rep.
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