A bill that Kentucky pharmacists are trying to curb the powers of prescription drug insurance intermediaries appears stalled in the Senate after it passed the House on March 21 by a vote of 88-3.
House Bill 457, aimed at for-profit entities known as pharmacy benefit managers, or PBMs, was handed over to the Senate Appropriations and Revenue Committee, often a dead end for legislation.
It follows a law the legislator enacted in 2020 cutting PBMs from the state’s $ 1.7 billion-a-year Medicaid drug program amid complaints from pharmacists that PBMs were profiting at their expense.
Supporters of HB 457, including Rep. Steve Sheldon, R-Bowling Green, are running out of worrying times over a bill that got unanimous approval in a House committee and was easily passed by the House. a week ago.
“This doesn’t make sense,” said Sheldon, a pharmacist and business executive. “How does he fall out of favor in a lick split?”
Sheldon and a coalition of health care organizations, including major hospital systems, are calling on the Senate to advance a bill that they believe will put community pharmacists on an equal footing with PBMs.
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“These profit-oriented PBM practices are bad for patients, bad for the employees in our businesses, and bad for Kentucky,” said a March 23 letter to 38 Kentucky senators signed by more than 30 health care organizations and 80 independent pharmacies.
“For too long, PBMS have played a huge role in the provision and cost of healthcare, often determining what Kentuckians pay at the pharmacy counter, what drugs they can access, and the amount that pharmacists are reimbursed for. their critical services, “the letter said.
PBMs, which act as intermediaries between health insurance companies and pharmacies, deny these allegations and counter their role is to negotiate the best prices for consumers and keep costs down.
A representative of the industry group, the Pharmaceutical Care Management Association, testified against the HB 457 to the committee, saying that the purpose of PBMs is to improve patient care and access to drugs.
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“We are the only entity whose goal is to reduce costs and increase access,” said Connor Rose, director of state affairs for the Washington DC-based association.
When asked about the status of HB 457, a spokesperson for Republican leaders in the Senate, whose party holds a super majority in the House, replied that it had been assigned to the Appropriations and Revenue Committee.
Sheldon said he had no information from the Senate about the fate of his bill.
“They tell me very little,” he said.
But industry opposition, including the PBM association, is likely a factor, Sheldon said.
Ron Poole, owner of five independent pharmacies in western Kentucky, said PBMs are a constant source of frustration for independent or community pharmacists who have to put them through a lot of prescriptions.
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PBMs decide how much pharmacists pay and increase their profits by cutting reimbursements to pharmacies, he said.
“We continue to deal with the middlemen who control most of the money,” he said.
The role of PBMs has become increasingly controversial in many states, including Kentucky, where lawmakers in 2020 enacted the law to cut PBMs, dominated by several national chains, from Kentucky’s Medicaid prescription drug business.
Sheldon said his bill is intended to curb some of the same practices that triggered the 2020 Medicaid bill.
HB 457 would ban PBMs from mandatory mail-order drugs and give pharmacists more power to negotiate the terms of the contract.
It would also prevent PBMs from “guiding” patients to PBM-affiliated pharmacy chains, which he says is common in the industry. For example, CVS Health operates one of the largest pharmacy chains in the nation and also operates a major PBM business that ran much of Kentucky’s Medicaid prescription drug business until 2020.
CVS is among the companies opposed to HB 457.
“We urge the Senate to reject the HB 457,” read a March 21 statement. “We should protect consumers from rising healthcare costs and lawmakers should focus on the high prices set by large pharmaceutical companies.”
At the hearing, the Kentucky Association Health Underwriters, the Kentucky Association of Manufacturers, and the Kentucky Association of Health Plans all testified against the bill worried that it could increase health insurance costs.
The 2020 law affecting Medicaid followed years of complaints from community pharmacists saying PBM business practices leave smaller, independent pharmacies at risk of extinction.
Pharmacists say the 2020 law helped with Medicaid prescriptions.
But Kentucky pharmacists still struggle daily with PBMs over other insurance claims, Cathy Hanna, president of the Kentucky Pharmacists Association, told the House Health and Family Services Committee on March 10.
“Unfortunately, the services provided by local pharmacists remain under constant threat from the harmful actions of major players in the health system,” including PBMs, he said.
Rose, with the industry association, testified that HB 457 would harm the valuable work done by PBMs in negotiating affordable drug prices and keeping overall costs low.
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“We are not paper dealers, monopoly men at the back of the room laughing and pocketing all this money,” he said.
But Hanna, president of the pharmacists’ association, said the companies reaped profits at the expense of pharmacists and consumers.
With the three largest PBMs controlling around 80% of the market, the industry has made “record profits in recent years,” Hanna said.
Sheldon said he just hopes it’s not too late for the Senate to consider his bill.
“It took three years to get to this point,” Sheldon said. “I just want to pass a bill that says we’re going to level the playing field a little bit.”
Reach Deborah Yetter at dyetter@courier-journal.com. Find her on Twitter at @d_anora. Support strong local journalism by signing up today: www.courier-journal.com/subscribe.