California Business Journal – August 25, 2020
Pharmacy Benefit Managers (PBMs) were created to be the middleman and negotiate drug prices. Working with the health care providers, pharmacies and the pharmaceutical companies determine reimbursements and what they’d charge the pharmacies. The problem is that without regulation, the PBMs have bad business practices. The fix is on the way.
Magnified by the economic and health care impacts of the novel coronavirus, the Florida legislature is honing in on regulations for a long-veiled middleman in the chain of rising prescription drug pricing.
Intended to serve as a beneficial consumer go-between for pharmacies and health insurance companies to provide cost analysis, Pharmacy Benefit Managers (PBMs) have instead transformed into a profit-driven model favoring, among other things, large pharmacy chains over payer and patient pocketbooks.
The classic Big Guy vs. Little Guy yarn was threatening to spin out-of-cost-control until organized advocacy groups and legislative voices added a new thread to the story: Regulation of PBMs’ ability to negotiate prices and rebates.
Echoing efforts in states across the country — while working to pave new regulatory ground — recently introduced bills across Florida’s congressional bodies are taking bipartisan aim at PBMs’ dichotomic practices.