Trumm Drug

MN Representative Collin Peterson Co-signs Pharmacy Bills

The Pharmacy Benefit Manager (PBM) Audit Reform and Transparency Act of 2010 has been created to help structure and regulate the practices of PBMs. PBMs make up the largest unregulated sector of health care. PBMs influence over 80% of the U.S. drug coverage market. Pharmacy Benefit Managers are, in sort, a middle man of health care benefits. Employers, unions, and even the U.S. government hires PBMs to administer drug benefits on behalf of health plan sponsors. PBMs are responsible for processing and paying drug claims, developing and maintaining formularies, contracting networks with pharmacies, negotiating discounts and rebates with drug manufactures.

Over the last several years, PBM operations have come into the media spotlight. Since PBMs operate without the restraints of any governmental regulation, their activities undergo constant scrutiny. Over the past few years, law suits totaling almost $317 million have been charged against PBMs. PBMs have been accused of price spreading, not passing on rebates and discounts from drug manufacturers to health plans and consumers, steering consumers to more expensive prescription drugs, and using anti-competitive practices. Price spreading, a common PBM practice, is when a beneficiary is charged “x” amount of dollars for a claim and then the pharmacy is paid a lower amount. The extra unaccounted amount is kept by the PBM. All of these questionable practices have contributed to the ever increasing health insurance premiums.

The new proposed Pharmacy Benefit Manager Audit Reform and Transparency Act will prohibit a group health plan from entering into a contract with any PBM to manage the prescription drug coverage or to control the costs of such coverage, unless the PBM fulfills certain requirements outlined in the bill. Proper regulation of PBMs will not only maximize positive patient outcomes, but will also assist to preserve the affordability of the prescription drug benefit itself.

The Medicare Access to Diabetes Supplies Act was created to exclude diabetic testing supplies (Lancets, glucose test strips, blood glucose monitors, etc.) provided by small pharmacies from Durable Medical Equipment (DME) competitive bidding.

The Medicare competitive bidding program is set up to reduce beneficiary out-of-pocket expenses, and to increase savings to taxpayers and the Medicare program on durable medical equipment. The current competitive bidding program strongly favors large-chain and mail-order pharmacies. The proposed bill will allow Medicare patients to be able to receive their diabetic supplies from smaller independent community pharmacies. In underserved rural areas that lack access to large-chain pharmacies, Medicare patients will be able to opt out of mail-order services and allow the patient to utilize the face-to-face pharmacist-patient interaction provided by their local community pharmacy. This will maximize overall patient medication management and health.

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