PBM Drug Pricing Transparency Bill Heads to Senate
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The Senate Committee on Commerce, Science and Transportation recently advanced a bill to increase pharmacy benefit manager (PBM) transparency and combat what some legislators called “deceptive practices.” The proposed bill received bipartisan support in the committee, with an 18-to-9 vote, and is supported by many health care and consumer organizations.
The Pharmacy Benefit Manager Transparency Act identifies activities that would be unlawful for PBMs to engage in, including the following:
- Spread pricing, a practice in which PBMs charge health plans and payers more for prescription drugs than they reimburse pharmacies
- Clawing back reimbursement payments from pharmacies
Additionally, PBMs would be required to direct 100% of any rebate to the plan or payer and disclose the cost and reimbursement to the health plan.
PBMs were initially formed to process claims and negotiate lower drug prices with drug makers. Today, they administer prescription drug plans for hundreds of millions of Americans and manage many aspects of the prescription drug process for health insurance companies, self-insured employers, unions and government programs. This includes developing lists of covered medications, negotiating rebates from drug manufacturers and contracting with pharmacies for reimbursement. According to the Pharmaceutical Care Management Association, PBMs play a positive role in creating savings and options and providing expertise for employers regarding prescription drug benefit design and coverage.
Since PBMs have largely operated out of the view of regulators and consumers, this bill could impact how PBMs operate, potentially increasing prescription drug transparency. There’s currently no timeline for the Senate to consider the bill. Last year, the Senate Committee on Commerce, Science and Transportation passed the same bill, but it was never put to a full vote on the Senate floor.
Employers should continue to monitor the situation closely. [B_Official] will keep you apprised of notable changes.
- Published in Blog
More Drugs, Less Money
By Alison Nelson, Account Manager
You may know him from Shark Tank or as the owner of the Mavericks, but you may soon know Mark Cuban as the man disrupting the pharmaceutical industry. It was recently announced that, billionaire Mark Cuban, has launched an online pharmacy boasting significant savings when compared to some traditional pharmacies. What makes this online pharmacy, Cost Plus Drug Company, stand out is their commitment to pricing transparency.
Cost Plus Drug Company is basing their prices on a 15% markup from the manufacturer cost and a $3 labor charge. This results in candid transparency on how much prescriptions costs to make. One of the medications listed on their website, estimates a $6,112.28 savings. The pharmaceutical industry is often associated with price gouging, prompting anticipation to see how other pharmacies respond.
To read more about Cost Plus Drug Company, read this NPR article or visit their website here.
- Published in Blog