By Todd Brown, Executive Director
Massachusetts Independent Pharmacy Association
Originally Published in CommonWealth Magazine, 12/13/18
A RECENT FEDERAL LAW allows pharmacists to inform patients when the price of their medication is less than the copayment they would pay using their insurance. This is helpful to some patients using certain low-cost medication. But there are much bigger savings to be realized by limiting payments to pharmacy benefit managers (PBMs) who have gone unregulated and taken advantage of that fact.
Unfortunately, the current system lacks transparency and accountability, allowing for a conflict of interest that results in PBMs reaping excess profits at the expense of all of us – employers, those covered by insurance plans in the private market, and taxpayers for publicly funded insurance programs.
By Steve Twedt
Originally published in Pittsburgh Post-Gazette, 12/11/18
Pennsylvania Auditor General Eugene DePasquale on Tuesday called on legislators to demand more transparency and accountability from pharmacy benefit managers, the middle-man companies that Medicaid contracts with to administer prescription drug plans that cover about 2.9 million Pennsylvania residents.
In an 18-page report released Tuesday, Mr. DePasquale said Pennsylvania paid PBMs $2.86 billion in 2017 for Medicaid beneficiaries’ prescriptions — an amount that one pharmacy benefit manager immediately disputed.
By comparison, the report said the state paid PBMs $1.41 billion in 2013.
The payments include both the pharmacy benefit managers’ cost of doing business and some profit, the report says, “but because PBMs’ business practices are shielded from public or government scrutiny, there’s no way to verify how much was profit.”
As a result, the auditor general concluded that Pennsylvania taxpayers “might be paying too much for medications, and PBMs might be pocketing that money."
by Katie Wedell
Originally Published in Dayton Daily News, 11/21/18
Ohio Attorney General Mike DeWine joined 32 other attorneys general in filing an amicus brief in the United States Supreme Court on Wednesday, supporting states’ rights to regulate pharmacy benefit managers and address the rising cost of prescription drugs.
Pharmacy benefit managers, or PBMs, act as middlemen between pharmacies, drug manufacturers, health insurance plans, and consumers for access to prescription drugs. The brief argues that regulation of PBMs is a matter for state authority in protecting the access to and affordability of prescription drugs.
by Matt Nye, originally published in ScriptedRx 10/21/18
A PBM makes $12,470 without providing any inventory, without counseling any patients, without interfacing with any healthcare professional on behalf of the patient and without fielding a single phone call regarding the medications prescribed.
Under the auspices of combating fraud, waste and abuse (FWA), the Center for Medicare Services (CMS) allows Pharmacy Benefit Managers (PBMs) to conduct audits of pharmacies that allow the PBM to deduct future payments owed for mistakes found during the period audited. Some independent pharmacy owners say the rules governing the audits are unfair, and the audits themselves are used to punish pharmacy owners that are outspoken about industry practices and who are only trying to do right by their patients.
In one example recently recounted to ScriptRXed, an independent pharmacy was subjected to an audit that focused on expensive insulin products and other name brand medications. Upon completion of the audit, no fraud was found, but the PBM cited clerical errors – like failing to properly document the substitution of Humalog for Novalog on an insulin prescription – as violations (the substitution was confirmed with the doctor, it just wasn’t documented to the PBMs standards).
Patients would be steered away from their physicians, Association of American Physicians and Surgeons said in letter to AG Jeff Sessions.
By Susan Morse
Published in Healthcare Finance, 9/25/18
The Association of American Physicians and Surgeons has added its voice to that of the American Medical Association in opposing the proposed merger between CVS Health and Aetna.
The deal would steer patients to insurance plans and site of care, and away from their physicians, according to AAPS President-elect Marilyn Singleton, MD, wrote in a letter to U.S. Attorney General Jeff Sessions and to Makan Delrahim, the assistant attorney for the General Antitrust Division of the Department of Justice.
WHY IT MATTERS
The Department of Justice is currently considering the proposed $69 billion deal for CVS to buy Aetna, with the industry expecting approval by the end of the year.
By Bruce Japsen
Originally published in Forbes, 8/29/18
Cigna said it is making progress with regulators to win approval of its acquisition of pharmacy benefit manager Express Scripts, confirming regulators in 14 of 29 states have signed off on the merger.
“Currently, Cigna has received approvals from 14 states,” the health insurer said Wednesday afternoon in a regulatory filing with the Securities & Exchange Commission. “Approvals from 15 additional states are conditions to closing the transaction.”
Auditor’s Report: Pharmacy Benefit Managers Take Fees of 31% on Generic Drugs Worth $208 Million in One-Year Period
From Press Releases - Ohio Auditor of State
Published August 16, 2018
Columbus – Ohio's Pharmacy Benefit Managers (PBMs) charged the state a “spread” of more than 31 percent for generic drugs – nearly four times as much as the previously reported average spread across all drugs, according to a new report by Ohio Auditor of State Dave Yost.
An analysis conducted by Auditor Yost’s staff found PBMs collected $208 million in fees on generic Medicaid prescriptions, or 31.4 percent of the $662.7 million paid by managed care plans on generics during the one-year period April 1, 2017 through March 31, 2018.
By Lucas Sullivan and Catherine Candisky
Published in The Columbus Dispatch, 8/14/18
The Ohio Department of Medicaid is changing the way it pays for prescription drugs, giving the boot to all pharmacy middlemen because they are using "spread pricing," a practice that has cost taxpayers hundreds of millions.
Medicaid officials directed the state's five managed care plans Tuesday to terminate contracts with pharmacy benefit managers using the secretive pricing method and move to a more transparent pass-through pricing model effective Jan. 1.
by Bruce Japsen
Published in Forbes, 2/1/18
The top insurance official in California urged the U.S. Justice Department to block the merger of CVS Health and Aetna, saying it would “have significant anti-competitive impacts on American consumers and health care and health insurance markets.”
The findings and recommendation by California Insurance Commissioner Dave Jones doesn’t derail the effort by CVS Health to buy Aetna, but the state regulator could have influence with the U.S. Justice Department as it evaluates the deal. California's insurance regulator described the Justice Department evaluation of the Aetna-CVS deal as "open" and outlined its reasoning for DOJ to block it in a 15-page letter.
Pharmacy First, a national network of more than 2,300 independent pharmacies, filed a lawsuit against Express Scripts in Federal Court to seek relief for, among other things, Express Scripts effectively excluding from its network of 83 million or more lives from Pharmacy First and all other Pharmacy Services Administration Organizations (“PSAOs”), except for four PSAOs handpicked by Express Scripts.