pbms

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, while PBMs take a small fee. Spread, on the other hand, reimburses a pharmacy a different amount for the drugs than what it charges the state. Grit Daily caught up …

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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 pharmacies to challenge the reimbursements. When the law went into effect in September 2015, the Pharmaceutical Care Management Association, which represents PBMs, immediately sued. The industry argued that state laws …

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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. Community pharmacies are independently-owned pharmacies that provide the same services as national retail pharmacies but cost the same, if not less, than the “big” pharmacies. Think of independent pharmacies like …

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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, 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 …

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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 financial losses in order to provide patients with necessary medications. Many of the customers who were refused Medicaid drug fulfillment ended up having an adverse health effect. This puts a …

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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 her face mask. “How’s your Dad?” asked a gentleman. “I love this place!” another customer whispered my way. “…been my pharmacy for years.” – the microphone in my hand inspiring …

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Pharmacy Benefit Managers Are the Real Reason Behind Skyrocketing Drug Prices

Grit Daily – April 30, 2020 Why are drug costs so high in America? If you ask Bernie Sanders, he will tell you that it’s due to the greed of the pharmaceutical industry. If you remember when “pharma bro” Martin Shkreli, former CEO of Turing Pharmaceuticals, made the price of the life saving drug Daraprim 5,000% higher overnight, you may agree with this assessment. But, there is more to the story, and it has to do with Pharmacy Benefit Managers (PBM’s). Within the healthcare industry, there are pharmaceutical manufacturers, pharmacists, insurance companies, and Managed Care Organizations (MCO) for Medicaid, but there is one more player that few outside of the industry discuss—the pharmacy benefit manager, or PBM. A PBM’s original role was to negotiate lower drug costs between drug manufacturers and insurance companies, with the goal of passing those savings on to the consumer. Instead, the rise of PBMs, who have amassed great …

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Neighborhood pharmacies struggle to stay open due to PBM restrictions

Tampa Bay News 10, July 9, 2020 So far, at least 8 independent Tampa Bay pharmacies have shut down because of challenges with Pharmacy Benefit Managers (PBM). As COVID-19 cases skyrocket in Florida, we’ve talked a lot about what doctors’ offices are doing, but what about pharmacies? Whether you realize it or not, your pharmacy options are becoming more limited but not because of COVID, but from something called Pharmacy Benefit Managers, or PBMs. It’s a big enough problem that one Tampa lawmaker is working to pass a bill to protect independent pharmacies and demand transparency. “Our motto here at Bill’s Prescription is to treat people like family,” pharmacist and owner of Bill’s Prescription John Basil Noriega said. Noriega’s family opened their own pharmacy back in 1956 in Brandon, at a time when the city population was just 2,000 people. “We have a lot of life long customers. We consider …

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Independent Pharmacists Stress Personal Touch In An Industry Dominated By Chains

The Town Crier, February 28, 2020 On Wednesday, Feb. 19, the advocacy group Small Business Pharmacies Aligned for Reform (SPAR) hosted a press conference at My Community Pharmacy in Wellington regarding pharmacy benefit managers (PBMs) and their effect on pharmaceutical pricing. Speakers at the event outlined what they called “shady” practices in the PBM industry that aims to put independent pharmacies, such as My Community Pharmacy, out of business. The pharmacy is located at 2615 S. State Road 7 near Whole Food Market in Wellington, owned by Johnny Meier, one of the speakers at the event. In attendance with Meier were other local, independent pharmacists, customers and Wellington Mayor Anne Gerwig. Several speakers addressed the problems involving pharmacy benefit managers — middlemen who are supposed to negotiate savings for customers — and complained that they do not, in practice, benefit either the pharmacists or their customers. The pharmacists addressed several bills …

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Data Proves PBM Industry Maximized Profit At Patient Expense

Cision Newswire, June 15, 2020 Physicians and Patient Advocates Call for More State Disclosures The Alliance for Transparent and Affordable Prescriptions (ATAP) reacted today to a report issued by the Texas Department of Insurance (TDI) showing the financial activity of the pharmacy benefit manager (PBM) industry in the Lone Star State. Texas law requires that PBMs annually report to the Insurance Commissioner aggregate data on rebates. “The Texas rebate report is unambiguous. The PBM industry has been generating significant profits while patients struggle to afford the cost of prescription drugs,” stated ATAP’s President Dr. Robert Levin. “Since 2016, through a complex rebate and price concession, the PBM industry in Texas pocketed more than $350 million in revenue, while passing a mere $16 million in savings to enrollees.” The data as reported by the PBM industry and compiled by the TDI may be found here:  https://www.tdi.texas.gov/reports/documents/drug-price-transparency-PBMs.pdf “PBMs owe it to patients to pass along savings to them,” Dr. Levin continued. “Now that Texas is …

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