Preserve Patient Access to Neighborhood Pharmacies
Studies and Data
AHCA Commissioned Analysis of FL Medicaid Confirms Over $90Million in PBM Spread Pricing
This recent independent analysis of Florida Medicare commissioned by the Agency for Health Care Administration (ACHA) sheds light on PBM fee and pricing practices in Florida's Statewide Medicaid Managed Care System (SMMC). The analysis confirms that PBMs have taken over $90 Million per year in excess profits through the use of spread pricing.
Legislative Leaders are Calling for Action
“Markets fail when markets get corrupted and that is what has happened here. When the middleman is allowed to own the end-retailer then the middlemen’s incentive to manage cost appropriately for the benefit of the chain is broken. And that is what has happened here.”
-- Rep. Randy Fine
“The power and control of PBMs has grown significantly over the last five to ten years. What we’re seeing is insurance companies owning PBMs and PBMs owning insurance companies. What is happening in the long run is that the price of prescriptions are going up.”
-- Sen. Gayle Harrell
“The practices PBMs use to drive up profits are complex, but the solution is simple: We need to increase access to care for all Floridians while ensuring that prescription drug savings make it to the patient and not the pockets of predatory PBMs.”
-- Rep. Jackie Toledo
When it comes to PBMs,
we all pay the price.
Pharmacy Benefit Managers (PBMs) are middlemen who have strayed from their original purpose of negotiating savings for patients and now keep the profits for themselves, leaving the rest of Florida’s consumers to pay higher drug prices. PBMs use anti-competitive practices to short-circuit the free market and create health care monopolies.
These predatory tactics decrease access for patients, force neighborhood pharmacies to close down, and raise costs for everyone. We need legislation that will increase transparency and accountability on PBMs and ensure that patients are prioritized over profits.
Who do PBM predatory tactics hurt?
Forcing neighborhood pharmacies out of PBM health networks causes many patients to drive extra miles from their home to receive medications simply because their local pharmacy is not in their plan. This not only steers business away from neighborhood pharmacies, it severely restricts patients’ access to medications and drives up their costs.
Many neighborhood pharmacies diligently refill prescriptions only to be hit with reimbursements that are pennies on the dollar – with some even facing negative reimbursements or clawbacks – while PBMs continue to make record-breaking profits. No business can sustain operations under this model, and it is a clear manipulation of the system that promotes anti-competitive practices.
PBMs are overstepping their scope and making medical decisions best left to physicians and pharmacists – and their years of training. PBMs are motivated by profit, not by what is best for the patient, and many times PBMs require the use of drugs or specialty medications that are not the most beneficial for the patient.
The anti-competitive policies that PBMs push increase health care costs for everyone. PBMs don’t make or provide the drug – they don’t even touch the drug – yet they add costs to the overall health care system that must be absorbed by pharmacists, patients, and all Floridians.
How Can We Fix This?
This year, the Florida Legislature is considering legislation to address these challenges. SB 1444 and HB 961 implement transparency, accountability, and free-market policies that will help preserve patient access and keep drug prices affordable.
Here are some highlights of the legislation:
- Protect the free market by prohibiting anti-competitive policies that reduce patient choice and create health care monopolies
- Eliminate the practice of steering patients to PBM-owned pharmacies, especially when it involves taxpayer dollars
- Prohibit the predatory practices that PBMs use to squeeze independent pharmacies, including post-adjudication fees, spread pricing, and cumbersome audit practices
By supporting this legislation, we can bring about concrete change in the industry and put a stop to the abuses that leave Floridians suffering.
Bloomberg September 11, 2018 For years, Frahm’s South Side Drug bought pills from distributors, and dispensed prescriptions to the Wapello County jail. In turn, the pharmacy got reimbursed for the drugs by CVS Health Corp., which managed the county’s drug benefits plan. As he compared the newspaper notice with his own records, and then with the county’s, Frahm saw that for a bottle of generic antipsychotic pills, CVS had billed Wapello County $198.22. But South Side Drug was reimbursed just $5.73. So why was CVS charging almost $200 for a bottle of pills that it told the pharmacy was worth less than $6? And what […]Read More