Utica-area pharmacists rally for transparency with drug costs
Health plans contract pharmacy benefit management companies to administer their prescription drug plans for members. The benefit managers negotiate prices with drug companies and determine which drugs will be on a health plan's formulary. Pharmacy benefit managers, or PBMs, argue that they help to lower the overall cost of prescription drugs.
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Chiffy blamed PBMs for the problems.
If signed by Gov.
It is opposed by the
"In its current form, the bill eliminates many of the cost-saving tools that pharmacy benefit managers, PBMs, use to reduce prescription drug costs and improve the quality of care for patients," reads a PCMA statement. "In addition to putting consumer safety at risk by removing specialty pharmacy accreditation standards, the legislation limits access to cost-effective drugs in favor of more expensive prescriptions. In fact, the bill would lead to
PHARMACY PAIN
Independent pharmacists argued that PBMs drive up drug prices and limit patient choice.
They also said PBMs are driving them out of business by forcing them to accept contracts without negotiation -- paying them below the wholesale cost of a drug, in some cases -- and often paying them less than chain pharmacies, which have more negotiating clout. The three biggest PBMs control 80 percent of prescriptions, Chiffy said.
"It's put a strain on us as far as our reimbursements," said
That has made it harder to deliver services to customers, he said. The pharmacies can no longer keep so much medicine in stock or offer deliveries as quickly, meaning customers may have to wait longer to get prescriptions filled, Black said.
"The reimbursement we're getting from PBMs very often is below our cost just for the drug," he said. And that doesn't include other expenses such as the cost of the bottle and the label, or staff salaries, Pardi said.
CONTROVERSIAL PRACTICES
The pharmacists highlighted two practices in particular that they argued need more scrutiny and oversight: price spreading and drug rebates.
"We get paid one price; the PBM then charges the insurer or the state or whoever a different price than they pay us," Chiffy said, describing a practice known as price spreading, which he said drives up drug costs.
PBMs also negotiate discounts and rebates with drug manufacturers, a practice that they and health plans argue helps to keep drug costs down.
But pharmacists and some others, including some state auditor generals, have questioned whether these rebates actually end up increasing drug prices. And PBMs do not have to disclose how much of the rebate money they keep.
REBUTTAL
PBMs do not unreasonably keep rebate savings, said
"Health plan sponsors have the final say on contract terms with PBMs, and they should be able to choose the contracts that best fit their plan populations' health care needs," Lopes said.
He disputed that the bill, if signed into law, will offer the promised benefits.
"While drugmakers alone have the power to set and raise prices," he said, "PBMs core mission is to reduce prescription drug costs and improve the quality of care for patients, while fairly compensating pharmacies for services they provide."
The health plan association supports the bill's goal of transparency, Senior Vice President
"Who is their chief responsibility -- to consumers, providers or health plans?" Moran asked.
She also pointed out that that the
"Our biggest concern," she added, "is that it really does nothing to get at the real problem that we're talking about which is rising pharmaceutical costs. And that's not on the part of PBMs; that's on the part of the manufacturers' themselves."
Chiffy disagreed.
"Our industry is so upside down," he said. "There's so many hands in it. I think that's why prescription drug costs are so high. Nobody knows what's going on. It's all so secretive. ... It's just so unregulated."
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