FOR IMMEDIATE RELEASE
Landmark PBM Reform Legislation Passed by PA House; Now to Senate for Consideration
Legislation to provide PBM transparency, lower prescription drug costs
HARRISBURG, Pa. (Jan. 29, 2020) — Your PA Community Pharmacies, a new coalition of independent, community pharmacies, today hailed passage of a landmark pharmacy benefit manager (PBM) reform package in the state House. The legislation — House Bills 941, 942, 943, 944 — are now in the state Senate for consideration.
PBMs are private entities that negotiate the purchase of prescription drugs, including for Medicaid recipients in Pennsylvania. PBMs were designed to save money through bulk purchasing power, but a lack of transparency and government oversight has led them to pocket hundreds of millions of Medicaid taxpayer dollars. Some PBMs also own retail pharmacies, often steering patients to their own pharmacies and potentially providing them with higher reimbursement rates, while cutting rates for community pharmacies. As they cut rates, some PBMs then send letters to their competitors, offering to buy their pharmacies.
Among the issues the package will address is a concept known as “spread pricing.” A report from Pennsylvania Auditor General Eugene DePasquale found that PBMs are keeping hundreds of millions of taxpayer dollars through spread pricing. In this scenario, PBMs bill health plans at a much higher price than they pay the pharmacies, resulting in PBMs keeping millions of dollars in savings that they should be passing along. Unfortunately, Pennsylvania state law doesn’t require PBMs to report spread pricing, leaving state lawmakers and Pennsylvania taxpayers in the dark.
Also supported by Your PA Community Pharmacies is a separate bill in the Senate, SB 789, which would forbid PBMs, or a corporate affiliate, from having any ownership interest in pharmacies, if they wish to participate in Medicaid.
“This package of House bills and Senate Bill 789 are designed to hold Pennsylvania’s pharmacy benefit managers accountable to countless Pennsylvanians who deserve to pay the lowest possible cost for their prescription drugs,” said Patricia Epple, CEO of the Pennsylvania Pharmacists Association and a coalition member. “We thank members of the House for their broad bipartisan support of this package. Your PA Community Pharmacies coalition stands behind this legislation to bring real transparency to drug pricing and to ensure PBMs are treating pharmacies and their patients fairly. We look forward to working with the Senate to secure final passage.”
Your PA Community Pharmacies (YPACP) is a coalition of YOUR independent pharmacies across Pennsylvania, who take pride in being long-standing members of their communities. For decades, we have served generations of Pennsylvania families with the best in pharmaceutical care. For more information, see www.ypacp.org. We also can be followed on Twitter at @ypacp.
Contact:Jill Gingrich, 717-991-1442
508 N. Third St.
Harrisburg, PA 17101