AGs in 39 states urge Congress to pass 3 pending PBM reform bills
The state AGs sent a letter to Senate and House leaders, highlighting the urgent need for federal action to mandate that pharmacy benefit managers increase transparency into their practices by sharing pricing with health plans.
A bipartisan majority of state attorneys general support ongoing efforts in Congress to reform the practices of pharmacy benefit managers.
“A small number of PBMs hold significant market power and are reaping abundant profits at the expense of the patients, employers and government payors the PBMs are supposed to help,” according to a letter from 39 attorneys general to congressional leaders. “”Pharmaceutical buyers and sellers have little choice but to employ PBMs, allowing them to extract both monopoly profits from individuals and monopsony profits from the market. Moreover, PBMs often dictate reimbursement rates and rules to independent pharmacies, making it difficult for many to survive.”
The letter expressed frustration with state efforts to regulate PBMs.
“While state law can provide the basis for oversight of and lawsuits against PBMs, states often face arguments by PBMs that federal jurisdiction and preemption limit states’ authority to regulate PBMs,” it said. “And now, PBMs routinely try to evade state law and obstruct state regulatory efforts by refusing to disclose data to state regulators as well as their own clients (i.e., health plans operated by employers and the government).”
The letter mentions three pending bills — the DRUG Act, the Protecting Patients Against PBM Abuses Act and the Lower Costs, More Transparency Act. This legislation would mandate steps for PBMs to increase transparency into their practices, including by sharing standardized pricing data with health plans and state and federal lawmakers
“Such transparency should, among other things, require PBMs to produce pricing data to health plans and federal and state regulators in a standardized format,” the letter said. “This will enable health plans to negotiate better deals with PBMs and will allow regulators to better hold PBMs accountable.”
The Pharmaceutical Care Management Association, a trade group representing PBMs, has countered that PBM-negotiated rebates are not linked to drug prices. Earlier this month, the group urged federal lawmakers to hold drugmakers accountable for high drug prices.
Related: Health care price transparency continues to be a conversation for House Committee
The letter was signed by the attorneys general of Alaska, Arkansas, Arizona, California, Colorado, Connecticut, the District of Columbia, Delaware, Florida, Georgia, Hawaii, Illinois, Kansas, Massachusetts, Maryland, Maine, Minnesota, Mississippi, North Carolina, New Hampshire, Nevada, New Mexico, New York, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, the Virgin Islands, Vermont, Wisconsin and Wyoming.