ALEXANDRIA, Va. — The National Community Pharmacists Association and 74 pharmacy stakeholders today submitted joint comments to the National Association of Insurance Commissioners on model legislation to regulate and license pharmacy benefit managers.
“When left to their own devices, PBMs are unwilling to play by the rules, operating largely in secret to bring in revenue for themselves to the detriment of all others,” says NCPA CEO B. Douglas Hoey. “They must be forced to operate fairly and transparently. Enacting the strongest policies possible can certainly help, but these policies must be fully enforced for patients to see lower drug prices and improved access to care.”
NAIC’s Pharmacy Benefit Manager Regulatory Issues Subgroup in July released its draft PBM model bill, which would require PBMs to obtain a license from the state’s insurance commissioner, permit the commissioner to adopt PBM regulations, and prohibit certain PBM abuses such as retroactive payment reductions, spread pricing, and self-dealing. NCPA worked with NAIC throughout the process and educated the subgroup on the impact PBMs are having on pharmacies, patients, and payers/taxpayers.
“More state legislatures are enacting PBM reform laws each year, and regulators must have the tools to rein in these runaway corporate middlemen,” Hoey said. “This is especially important in view of the pending U.S. Supreme Court case, Rutledge v. PCMA, which could greatly expand the ability of states to regulate PBMs. The ruling will impact state authority to rein in the PBMs and protect consumers. The model legislation that we are pleased to recommend would give them a running start.
“We’re prying open the black box of the PBMs at every level and every opportunity, sounding the alarm about PBMs and pushing to fix their business model,” he added. “They have failed to manage the cost of prescription drugs, which is why they were created, and are inflating prices for patients and destroying local pharmacies. Pharmacy is grateful to NAIC and others for seeing this and acting to protect their constituencies. We are an eager partner in these efforts and appreciate the opportunity to assist.”
The comment period on the bill closes today, Sept. 1. The subgroup is scheduled to review the comments on Sept. 14 and is expected to release another draft bill sometime after that discussion.