Rep. Earl L. “Buddy” Carter (R-Georgia) introduced the PBM Reform Act last week, which seeks to crack down on pharmacy benefit manager (PBM) practices.
The bill has bipartisan support and was co-sponsored by Representatives Debbie Dingell (D-Michigan), Greg Murphy (R-North Carolina), Deborah Ross (D-North Carolina), Jodey Arrington (R-Texas), Diana Harshbarger (R-Tennessee), Vicente Gonzalez (D-Texas), Rick Allen (R-Georgia), Raja Krishnamoorthi (D-Illinois), John Rose (R-Tennessee), Derek Tran (D-California), and Nicole Malliotakis (R-New York).
The bill will ban spread pricing in Medicaid. This is when a PBM charges payers more than they pay the pharmacy for a medication and then keeps the difference as profit. It also seeks to “delink” PBM compensation from the cost of medications under Medicare Part D.
In addition, it will require semi-annual reporting on drug spending, rebates and formulary determinations. It will also mandate that the Centers for Medicare and Medicaid Services enforce “reasonable and relevant” contract terms in Medicare Part D pharmacy contracts and address violations.
The introduction of the bill comes as the big three PBMs — CVS Caremark, UnitedHealth Group’s Optum Rx and Cigna’s Express Scripts — control 80% of the prescription drug market.
“It’s time to bust up the PBM monopoly, which has been stealing hope and health from patients for decades. As a pharmacist, I’ve seen how PBMs abuse patients firsthand, and believe that the cure to this infectious disease is transparency, competition, and accountability, which is exactly what our bipartisan package provides,” Carter said in a statement.
Carter’s comments were echoed by Dingell of Michigan.
“For too long, pharmacy benefit managers have been allowed to operate unchecked, raising prices and preventing many patients from getting the medications they depend on,” Dingell said in a statement. “I hear from too many Michiganders, especially seniors, who can’t conveniently access the prescriptions they need, due to exploitative PBM practices complicating access to their local pharmacies. Their harmful, aggressive tactics are only getting worse, and we must take action now to protect pharmacies and lower patient costs. I remain committed to working with my colleagues on both sides of the aisle to get this across the finish line.”
Numerous other efforts have been taken targeting PBMs. The state of Arkansas recently created a law banning PBMs from owning and operating pharmacies in the state, prompting CVS Caremark and Express Scripts to file separate lawsuits challenging the law. In December, Senators Elizabeth Warren (D-Massachusetts) and Josh Hawley (R-Missouri) introduced a bipartisan bill that would also ban PBMs from owning pharmacies.
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