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NCPA praises proposed PBM legislation


ALEXANDRIA, Va. An organization representing the nation's independent pharmacies has praised a piece of legislation that calls for more transparency among pharmacy benefit managers.

Sen. Maria Cantwell, D-Wash., recently authored an amendment which requires the adoption of disclosure requirements for any PBM participating in the health insurance exchanges envisioned under America's Healthy Future Act, a bill drawn up last week by Senate Finance Committee chair Max Baucus, D-Mont.

The Cantwell amendment would require PBMs to provide basic aggregate information so that health plan sponsors can make educated decisions about which PBM offers the best value for the plan and patients. Under the amendment, plan sponsors and the commissioners of any state insurance exchange could have access to data in three key areas:

  • First, a breakdown of those prescriptions provided through retail pharmacies as well as mail-order pharmacies and the generic drug dispensing and substitution rates of each. 
  • Second, the average aggregate amount and characterization of rebates and other discounts paid by manufacturers, and the aggregate amount kept by PBMs.
  • Third, the average aggregate difference between the amount the PBM is paid by the plan and the average aggregate amount the retail and mail-order pharmacies are paid, respectively, for dispensing a prescription.

The disclosure requirements only apply to PBMs operating in a health insurance exchange.

NCPA and consumer groups have long advocated PBM reform. NCPA testified before a Senate Commerce Subcommittee in July and submitted comments to a House Oversight and Government Reform Subcommittee hearing in June on the Federal Employee Health Benefits Program. At the latter, a top government auditor testified that there's a “good chance” taxpayers and plan participants are “not getting a good deal because of the lack of transparency” by PBMs.

“We commend Sen. Cantwell for standing up for patients and we urge senators to support this proposal to drive down healthcare costs,” said Bruce Roberts, NCPA EVP and CEO. “For too long, a shroud of secrecy has allowed these companies to pocket large portions of both the transactions they process as well as the rebates paid by manufacturers.  Patients and plan sponsors are footing the bill in the form of higher insurance premiums while PBM profits soar – up 20% last year alone. Public and private plan sponsors are increasingly insisting on PBM transparency for good reason.”

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