As states begin to address the heretofore unchecked practices of pharmacy benefit manager (PBMs) middlemen amidst a rash of publicity and legislation, Georgia has quietly introduced and passed legislation that could change the game for Georgia patients and serve as a model for other states looking to protect patient choice and access to care. This legislation - HB 233 by Rep. David Knight - awaits Governor Brian Kemp’s signature before passing into law May 12th.
While most state legislation, including HB 323 in Georgia, looks to rein in problematic PBM practices, Georgia’s HB 233 takes a new tact – regulating pharmacies that are owned/affiliated with PBMs and insurers through the elimination of patient steering practices.
HB 233 specifically prohibits pharmacies owned by PBMs and insurance affiliates from receiving self-dealing referrals and from engaging in data mining for commercial (non-patient care) purposes. The bill also requires pharmacies to disclose affiliates to the Board of Pharmacy and contemplates Georgia Board of Pharmacy oversight.
“Though often overshadowed by issues such as DIR fees and spread pricing, PBM-owned pharmacies have been able to engage in patient steering on the grandest of scales, to the point it has become a core business strategy,” says Georgia state representative David Knight. CVS says as much in a statement from CEO Larry Merlo in their 2017 Annual Report:
“Over time we have developed new plan designs that save our clients money while simultaneously moving share into our channels. For example, the new plan members we enrolled over the past three selling seasons will contribute an additional 40 million prescriptions to the enterprise in 2018.”
Frustratingly, PBMs often take the position that state law requiring regulation is preempted by federal law, thus limiting the scope and impact of many previously-passed state laws Yet pharmacies are subject to significant state regulation. What makes HB 233 unique -- and apparently gives PBMs pause -- is that it targets the very point at which PBMs ARE subject to state regulation - their pharmacies.
“It’s a simple yet brilliant strategy that may change the game and provide patients the broadest possible protections. For patients who have been forced into mail order or other PBM-owned pharmacies, there are few issues more important in healthcare than patient steering,” says Scott Newman, PUTT president. “Steering, whether into mail order or a PBM-owned brick-and-mortars impacts the most vulnerable patients. PUTT applauds the State of Georgia for recognizing the need to stop the practice all together.”
HB 233 had more than 90 co-sponsors and enjoyed near unanimous support. However, despite the grassroots support, the PBM lobby is currently exerting tremendous pressure in the hopes of getting a veto by May 12, which is the state deadline for Governor Kemp to veto 2019 legislation. In the meantime, the pharmacists and their patients wait, hopeful that patient mandates and steering will soon be a thing of the past.
Canadian and Foreign Drug Importation Won't Provide Choice OR Cost Savings for Patients and Plan Sponsors - Here's Why:
At a time when prescription drug prices are so high that several states are considering legislation to make foreign prescription drug importation legal, PUTT again warns legislators and consumers that this proposed “solution” will NOT fix the problem of high drug prices.
As pharmacists, our first concern is for patient safety. But we also know (a little too well) how drug prices force some patients into rationing medicine or not filling a prescription, and that legislators are responding to constituents’ concerns for drug cost. Still, foreign drug importation, while it may provide some superficial cost savings, will not provide the kind of choice or value patients need.
Consider the proposed plan in Florida. PUTT requested public records for Flagler County’s much-touted CanaRx program, and learned a few things:
Lesson #1: Transparency works. Under Florida’s “sunshine laws” we can see the 2018 quarterly cost reports for prescriptions available under CanaRx. On the report, the green highlighted items are prescriptions ALREADY available as generic in the U.S.
In the midst of one of the most actively healthcare-focused legislative seasons in years, several states have begun to address the issue of PBM abuse by introducing legislation that attempts to rein in the unchecked power of the middlemen.
In Maryland, Brian Hose and Steve Wienner - two seriously committed pharmacists - led the fight along with the Maryland Pharmacists Association, Epic Pharmacies, and the Independent Pharmacies of Maryland for PBM reform that culminated in the recent passage of three bills that target unfair PBM practices and now require pricing transparency, and the elimination of DIR fees.
Because every big legislative win has its roots in small past victories, PUTT asked Brian and Steve to share their story and advice for other pharmacists working at the state level to enact change.
"This year was out of the ordinary," said Brian. "A lot of it was due to small changes that have been taking place in the years prior, when the PBMs would give us a small concession and then find a way to skirt the law, which would then set us back two steps. The legislators finally started to see what was going on and made some measurable changes this year."
“It's been years and years in front of the legislature,” said Steve. “I think a lot of people don’t realize that you’re not going to be involved for one year and get everything you want.”
Both Steve and Brian have spent more than five years actively testifying in front of the Maryland state legislature. They have participated in legislative work groups tasked with finding common ground and/or compromises between independent pharmacies and the PBMs; educated legislators on the intricacies and importance of NADAC; and driven home the value of independent audit firms as non-partisan, trustworthy resources for pending legislation.
Since PBM contracts prohibit pharmacies from informing the end payer about pricing and fees, they and their fellow pharmacists worked toward legislation that would allow a work-around. Said Steve, “If I pick up a phone and call them, I can’t say ‘your PBM is screwing me,’ but when the Maryland Insurance Administration drops 50 to 100 appeals on them and says ‘this is a problem and these are the drugs,’ now you have a 3rd party saying ‘you need to investigate that’.”
Insight, “outside the box” thinking and absolute tenacity have fueled their motivation to bring about real change in Maryland, which, like other states, has seen the closure of scores of pharmacies as PBMs cut reimbursements, increase DIR fees and use audit penalties as a means to improve their own bottom line.
Both Steve and Brian advise pharmacists to stay actively involved throughout the entire legislative process to achieve their ultimate goal. “We saw a big shift this year in the way that government agencies were behind us,” says Brian. “Before, they would try to be an impartial mediator through the process, this year they testified on behalf of these bills, they drafted language that strengthened the bills -- they were very involved.”
An added benefit to pharmacists remaining actively involved: Maryland legislators are beginning to understand the added value independent pharmacies provide patients. This is especially important in a state where, on average, there’s a chain drugstore within 10 miles of every citizen.
The proof is in the legislation passed. While HB 754 was not passed in its original form, (a sore point for many) these two feel that the combination of all 3 bills lay a solid groundwork for building upon next session.
Their advice for pharmacists entrenched in legislative battles in other states? Make sure you have someone in every step of the process. From the hearing to the work groups to the sub-hearing. It’s not easy, but someone’s got to be involved.
“We are advocates for our profession. We’ve been doing it for a long time, and we’re glad to see the success,” said Brian.
“Everyone has to give back to their profession in some way,” says Steve. “Some do it in academia, teaching, or study; some do trials in their store; the way we personally give back to our profession is through legislative activism.”
Some superheroes wear capes. This dynamic duo proudly wears lab coats!
When it comes to making a buck, PBM middlemen have no shame. Rebates that should be lining the pockets of Medicare Part D insured American patients are being unscrupulously rerouted to line their own pockets instead. It's time to put a stop to these greedy tactics that have resulted in the skyrocketing of prescription medication costs. It takes less than 5 minutes to make your voice, and the voices of your patients heard. Don't miss this opportunity to play a part in this important healthcare legislation.
Click HERE to tell the HHS that you support their proposed amendment to the safe harbor regulation on discounts!
"The power of one, if fearless and focused, is formidable, but the power of many working together is better" ~ Arroyo
Straight Talk: Local Louisiana Pharmacists, Sec. Alex Azar Discuss Urgent Issues Facing Patients and Their Pharmacies
One day after President Trump declared in his State of the Union address the need for prescription drug pricing reforms, Health and Human Services Secretary Alex Azar paid a visit to patients and pharmacists at Chateau Drug and Gifts in Metarie, LA to continue the conversation. Chateau Drug owners Kerry and Diane Milano, both pharmacists, hosted Sec. Azar and a small contingent of patients and pharmacists for an in-depth discussion of issues facing small business pharmacies and their patients.
Sec. Azar addressed several “hot button” issues: high drug prices, lack of choice, secret mark ups and exorbitant DIR fees charged by PBMs that ultimately undercut pharmacies and are passed on to patients as higher drug costs and insurance premiums. During his visit, Sec. Azar observed Chateau Drug pharmacists in action filling prescriptions and counseling patients, noting the degree to which independent pharmacies are the patient’s most accessible healthcare providers.
The visit, which was coordinated by the Louisiana Independent Pharmacies Association (LIPA) and NCPA, came as a result of Sec. Azar’s interest in some of the state’s proactive laws, which provide a level of patient and pharmacy protections against price gouging and retroactive fees. In 2016 Louisiana passed a law prohibiting PBMs from directly or indirectly charging or holding a pharmacist or pharmacy responsible for any claim-related fees that were not disclosed upfront or after submitted for reimbursement. According to a recent PUTT survey, most independent pharmacies pay an average of $107,302 per store in retroactive DIR fees.
Just last week AP news reported that Sec. Azar had asked Congress to pass the administration’s new prescription drug discount plan and provide it to all patients, not just those covered by government services plans like Medicare. The plan would channel the now hidden rebates on prescription drugs directly to patients, removing that money from the current grasp of the PBMs. In a separate story released on February 5th by CNBC, President Trump was quoted on the issue as saying, “It is unacceptable that Americans pay vastly more than people in other countries for the exact same drugs, often made in the exact same place. This is wrong, unfair, and together we will stop it.”
Dear Judge Leon,
My name is Teresa Dickinson, and I am an independent pharmacy owner in Phoenix, AZ. I am also the president of Pharmacists United for Truth and Transparency (PUTT), a coalition of more than 1,200 independent and community pharmacies across the U.S. I am writing on behalf of my organization and small business pharmacy owners everywhere to express our full opposition to the CVS-Aetna merger. We are greatly encouraged to know you are carefully considering the merger of these two excessively large corporations that together control a disproportionate share of the healthcare marketplace.
Sir, you mentioned feeling as though you are “in the dark” with regard to the merger. We promise you are, as are most Americans about the true nature of the pharmacy benefit manager (PBM) industry. CVS, along with Express Scripts and OptumRx, control nearly 80% of all prescriptions filled in the U.S. All 3 are either owned, or poised to be owned, by extremely large health insurance companies who also seek to control and serve as the gatekeeper between patients and pharmacy, medical providers and other sectors of the healthcare system.
Here are some things you may not know about CVS:
If you're worried about the impact of the seemingly inevitable CVS/Aetna merger, consider the following:
On February 8, 2018, Arkansas Attorney General Leslie Rutledge opened an investigation into the CVS Caremark reimbursement rates to Arkansas pharmacies, much to the delight of her state's community pharmacies -- and the nation. Ms. Rutledge took a bold and remarkable stand against PBM abuse. Since that day:
With this week's news that the U.S. Department of Justice has given Cigna and Express Scripts the go-ahead to merge, it's worth revisiting - and re-stating - the obvious: PUTT opposes the CVS-Aetna merger.
PUTT also opposes Cigna-Express Scripts and any other "mega mergers" that result in one less choice for consumers; one more layer of bureaucracy for patients who find themselves "lost" or treated like a number in corporate healthcare; and one more headache for pharmacies trying to care for patients AND keep the doors open for business.
PUTT issued the following statement on December 7, 2017 just after CVS announced its intent to buy Aetna:
Why Would Community Pharmacists Travel 1,522 Miles to Ask "Less Government" Legislators for MORE Government?
When New Orleans hosted the American Legislative Exchange Council conference last week, community pharmacists traveled distances greater than 1,500 miles to ask the “limited government, free markets and federalism”-favoring legislators for MORE regulation over pharmacy benefit managers (PBMs).
Pharmacies are excluded from the “free market” system by unregulated, middlemen PBMs who have been allowed to take over the pharmacy industry, co-opting the role of physicians by deciding patients’ drug options and coverage; gagging pharmacists from informing patients when it’s cheaper to pay out of pocket than use insurance; and keeping manufacturer rebates instead of giving them to the patient. And that’s only a few of the tactics PBMs use to control the supply chain from drug manufacturer to pharmacy counter to patient.
PBMs rig the system by designing benefits plans to appoint themselves -- mere claims administrators -- as the final authority on plan formularies, pharmacy reimbursements and plan premiums and copays. Their system is “proprietary” - but that’s just code for “arbitrary and capricious” because no one knows how they actually determine plan prices and reimbursements. They are not required by law to divulge this information - even to taxpayers, whose hard-earned dollars fund Medicaid and Medicare.