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What Every Challenger Brand Can Learn From The Nation’s Smallest Pharmacies

Forbes A campaign against drug rebate kickbacks isn’t something you’d typically think would have much relevance to small businesses in other industries.  However, a recent effort by a Florida-based small business pharmacy advocacy group, SPAR (Small Business Pharmacies Aligned for Reform), is offering a glimpse of how small, challenger businesses can fight back against much larger and more powerful organizations—and win. The founding of SPAR dates to a Trump administration Executive Order to prevent the drug rebate kickbacks passed between prescription drug manufacturers and pharmacy benefit managers (PBMs). Essentially, PBMs, which work with health insurance companies, negotiate with pharmaceutical companies to receive a portion of a drug’s list price every time that drug is dispensed. These “rebates,” which the PBMs receive, are […]

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Study Finds PBMs are Draining Florida’s Medicaid Funds

Grit Daily A study exploring Florida’s prescription drug costs through the Medicaid program found that pharmacy benefit managers (PBMs) profited $89 million dollars, mostly from a spread pricing contract scheme that charges the state higher cost than will be disbursed to the pharmacist. Florida’s Medicaid program is contracted out to private healthcare companies like CVS Caremark, Humana, etc. Those private companies then take Medicaid dollars and draw up contracts with pharmacies around the state. PBMs play the role of negotiating drug prices between pharmacy suppliers and payers; they have an outsize stake in what consumers pay for their prescription drugs. PBMs in Florida operate in 2 ways depending on the county – pass-through or spread. Pass-through pricing reimburses pharmacists the cost of the drug, […]

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Arkansas’ PBM law unanimously upheld by U.S. Supreme Court

TalkBusiness.net The U.S. Supreme Court ruled in favor of an Arkansas law on a controversial pharmacy benefit manager (PBM) statute on Thursday (Dec. 10). The 19-page decision from the nation’s high court was unanimous. The ruling in Rutledge v. Pharmaceutical Care Management Association centered around Act 900, which was passed in Arkansas in 2015. Act 900 regulated pharmacy benefit managers, which act as middlemen between pharmacists and insurance providers. Their reimbursement rates theoretically incentivize pharmacies to find lower wholesale drug prices. Pharmacists said the PBMs’ reimbursement rates were too low – in fact, too often below the pharmacists’ cost of procurement. The Arkansas law requires PBMs to increase reimbursements for generic drugs if they are below wholesale costs, and it created an appeals process for […]

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Florida finds pharmacy benefit managers are benefiting from a lucrative profit center

Stat News As states struggle to control the cost of prescription medicines, a new report found pharmacy benefit managers pocketed more than $89 million collected on behalf of the Florida Medicaid program — and the consultants who ran the analysis recommended state officials rework the arrangements. The report found that PBMs appear to have profited from what is known as spread pricing, which refers to the dispensing fees that these companies pay pharmacies but then bill at a different rate to state Medicaid programs. In this instance, the PBMs working with managed care plans made $8.64 for each Medicaid prescription, which accounted for 9.5% of total plan spending.  Continue Reading

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Tampa Representative to Propose Plan to Hold Pharmacy Benefit Managers Accountable

Bay News 9  —  Tampa Rep. Jackie Toledo says she will soon refile a version of her 2020 proposed legislation that intends to lower prescription drug prices by holding pharmacy benefit managers (PBMs) more accountable. PBMs are third-party companies that serve as intermediaries between drug companies and insurance companies. They pool money from contracted pharmacies to gain purchasing power, then negotiate rates and rebates with the pharmaceutical companies. Their business agreements have raised questions about pricing transparency and state legislators, like Toledo, have been pushing to regulate PBMs in recent years. “Right now, they’re unregulated, so they’re taking advantage of the system,” Toledo said. “They’re pretty much dictating the cost of prescription drugs and right now there’s absolutely no transparency, so […]

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FLORIDA’S SECRET DRUG PRICING SCAM YOU’VE NEVER HEARD OF

Medium.com Though you may have never heard of them, pharmacy benefit managers (PBMs) play a critical role in the price you and I pay for prescription drugs at the pharmacy. Like rats in a sewer, PBMs thrive on secrecy. Once the processors of prescription drug claims, today the largest PBMs are subsidiaries of the largest health insurers, helping corporations like CVS Health and UnitedHealth leap to 5th and 7th place respectively on the Fortune 500 — just behind better-known corporations like Walmart, Amazon, and Apple. Bear in mind PBMs and insurers don’t manufacture a product or provide a service. They’re simply extremely wealthy middlemen. PBMs exert more control over the price of prescription drugs than you might imagine. They create […]

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What “Big Insurance” Doesn’t Want You to Know About Community Pharmacies

Medium.com Patients and pharmacists share a special relationship, often stretching back generations. Even the frightening spike in drug costs can’t erode the feeling of trust and care we feel when walking into our neighborhood pharmacy. But “neighborhood pharmacies” as we know them are rapidly disappearing, victims of large corporate pharmacy benefit manager (PBM) “middlemen” that now dominate the drug industry. If you’ve never heard of PBMs, you’re not alone. The largest PBMs own or are owned by, well-known health insurers (UnitedHealth; CVS Health, CIGNA) — and all own or have affiliate relationships with their own pharmacies. If you’re a die-hard CVS or Walgreens shopper, you may not be familiar with the neighborhood (or community) pharmacy — but you should be. […]

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Prescription for Transparency

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, […]

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Pharmacy Deserts Are on the Horizon if PBMs Continue to Underpay Medicaid Reimbursements

Grit Daily – August 17, 2020 Independent pharmacies are being forced into bankruptcy due to underpayment for Medicaid reimbursements, which are managed by Pharmacy Benefit Managers (PBMs.) These small pharmacies are deciding to either turn away Medicaid patients or to close their practices, creating pharmacy deserts in poor neighborhoods. A survey of 123 independent pharmacies in Florida found that over 60% “may be forced to discontinue taking Medicaid patients if changes are not made to the program that currently requires neighborhood pharmacies to sell most prescription drugs at a loss.” 93% declared having to turn away at least one Medicaid patient per month because dispensing to them would cause the pharmacy to lose money. There are ripple effects to having pharmacies take repeated […]

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Why are neighborhood pharmacies disappearing? Ask the Noriega Family.

Lissette Campos – July 15, 2020 I arrived at Bill’s Prescription Center in Brandon an hour early, half expecting to find a quiet operation with the owner prepping for our television interview. After all, how busy can they be? I’m here because neighborhood pharmacies like this one, close to 100 in the Tampa Bay area alone, are in danger of closing. Common sense would have you believe the disappearing act is caused by a lack of customers. Three minutes in, I realized there’s nothing common sense about this situation. A steady stream of customers didn’t just walk in for their medicines, they arrived for, what felt like, a family reunion! “Hi Basil? How are you?” asked one woman, smiling under […]

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