![PBM Oversight Bill: Senators Push for Drug Price Transparency | [Year] Update](https://medcitynews.com/wp-content/uploads/sites/7/2018/09/GettyImages-914792268.jpg "PBM Oversight Bill: Senators Push for Drug Price Transparency | [Year] Update")
Bipartisan Bill Targets PBMs in Push for Prescription Drug transparency & Lower Costs
For years, the rising cost of prescription drugs has been a major concern for Americans. A notable, yet often overlooked, driver of these costs is the role of Pharmacy Benefit Managers (PBMs).Now, a bipartisan effort is underway in the Senate to bring greater transparency and accountability to these powerful industry players.
This article breaks down the key details of the proposed legislation, the challenges pbms pose, and what it means for you – whether you’re a patient, a pharmacist, or a taxpayer.
What are PBMs and Why the Scrutiny?
Pharmacy Benefit Managers act as intermediaries between drug manufacturers, insurance companies, and pharmacies. They negotiate drug prices,create formularies (lists of covered drugs),and process prescription claims. However, their practices have come under intense scrutiny due to:
* Vertical integration: The top three PBMs – CVS Caremark, Cigna’s Express Scripts, and UnitedHealth Group’s Optum Rx – control roughly 80% of the market. This consolidation raises concerns about competition and potential conflicts of interest.
* Lack of Transparency: The complex system of rebates and discounts negotiated by PBMs often obscures the true cost of drugs.
* Inflated Drug Prices: Critics argue PBMs prioritize maximizing their own profits,sometimes at the expense of patients and the healthcare system.
The PBM price Transparency and Accountability Act: Key Provisions
On Thursday, Senate Finance Committee Chairman Mike Crapo (R-Idaho) and Ranking Member Ron Wyden (D-Oregon) introduced the PBM Price Transparency and Accountability Act. This bill aims to address these concerns through several key measures:
* Delinking Compensation from Rebates: Currently, PBMs are incentivized to favor higher-priced drugs that offer larger rebates. This bill would change that, encouraging them to negotiate for the lowest possible net prices.
* Increased Reporting Requirements: PBMs would be required to provide more detailed reports to Medicare Part D plan sponsors and the Department of Health and Human Services (HHS).This increased visibility will help identify potential issues and ensure accountability.
* Enhanced Auditing Capabilities: Plan sponsors would gain greater ability to audit PBMs, verifying that they are adhering to agreed-upon terms and acting in the best interests of their members.
* protecting Self-reliant Pharmacies: The bill strengthens requirements for plan sponsors to contract with “any willing pharmacy” that meets standard terms. This is crucial for preserving access to care in rural communities where independent pharmacies often serve as the primary healthcare provider.
* Accurate Medicaid Reimbursement: Retail community pharmacies would be mandated to participate in the National Average Drug Acquisition Cost (NADAC) survey. This will lead to more accurate Medicaid reimbursement rates,ensuring pharmacies are fairly compensated for dispensing medications.
* Direct Payments to Pharmacies: pbms would be required to pass Medicaid payments directly to pharmacies, increasing transparency in drug costs for states and taxpayers.
What Do Lawmakers Say?
“Pharmacy benefit managers should not profit from overcharging patients for their prescriptions,” stated Chairman Crapo. He emphasized the bill as a “decisive step” towards a more navigable and affordable prescription drug market.
Ranking Member Wyden echoed this sentiment, declaring, ”It’s long past time to go after middlemen who are making americans’ prescription drugs more expensive.” He highlighted the bill’s “comprehensive approach” to stopping harmful PBM practices.
The bill currently boasts support from 19 additional senators, demonstrating broad bipartisan interest in addressing this issue.
A History of Attempts & State-Level Action
Efforts to rein in PBMs aren’t new. Last year, a provision to crack down on pbms was nearly included in a federal spending bill, but was ultimately removed.
However, states are taking matters into their own hands:
* California: Recently passed a law regulating PBMs, aiming to increase transparency and control costs.
* Arkansas: Enacted a law banning PBMs from owning pharmacies,but a federal judge has temporarily blocked it’s implementation due to legal challenges.
These state-level actions underscore the growing frustration with PBM practices and the urgent need for reform.
What Does This Mean for You?
If this bill becomes law, you could see:
* Lower Prescription Drug Costs: By removing incentives for PBMs to favor higher-priced drugs, the bill could lead
