Prescription drug prices have once again become a hot-button issue this presidential campaign season, thanks in no small part to one unscrupulous young biotech executive who smirked his way through recent Congressional hearings on the matter. But the outrage and emotion generated by the kind of price-gouging practices at Turing Pharmaceuticals can feed the false notion that there’s an easy fix to an issue as complex as prescription drug pricing.
Most people are familiar with the large drug and insurances companies, which seem like obvious targets for reform. But what if I told you that an invisible layer of intermediaries between the two have become not just some of the biggest players in the health care industry, but some of the largest companies in the country?
So-called pharmacy benefit managers (PBMs) were initially designed to control drug pricing through claims processing and price negotiation. But in reality, the three out-of-state PBMs that dominate Washington’s health care marketplace have become larger and more profitable than Boeing, Amazon or Microsoft. In fact, they’ve become larger than Pfizer and Merck.
Can anyone be surprised that prescription drugs have become unaffordable for many Washington families at the same time that the middlemen meant to keep prices down have grown larger than the two biggest drug manufacturers themselves?
Worse still, PBMs are unregulated in Washington. This has allowed them to assert power over basic elements of patient care that is both unparalleled and unconscionable, including the type of medication patients are allowed, the dosage and frequency they may take it, the co-pays they must pay, and even where they may go to receive their care.
Far too often, patients with deadly or debilitating illnesses are learning that PBMs refuse to cover their generic drugs. Patients seeking “covered” medications from their pharmacies are discovering that PBMs will not adequately reimburse the pharmacy for the cost of their medications. This is putting pharmacists in the no-win position either of turning away patients in need (placing patients’ health at risk), or providing medication at below their own costs (placing their own businesses at risk).
Most pharmacy owners would sooner risk their businesses than turn away sick patients in need of medicine. And, indeed, both local and chain drugstores in communities throughout Washington are closing their doors – especially rural drugstores, the lifeline for patients in our rural and underserved communities.
The predatory activity of PBMs is unacceptable and dangerous. It must come to an end, and legislation currently under consideration in Olympia would put Washington firmly on that path.
Senate Bill 5857 would bring PBMs under the regulatory oversight of the Office of the Insurance Commissioner, make their pricing schemes transparent to lawmakers and the public and create an independent appeals process – which would help curb the disturbing trends we are currently witnessing in Washington’s prescription drug market.
SB 5857 faces tough opposition from Express Scripts, CVS Health, and OptumRx, the powerful but invisible PBMs with a stranglehold on the Washington drug market. But by raising enough awareness among patients about the effects of PBMs’ undue influence in pricing their medications, there is still an opportunity to pass this important consumer- and patient-protection legislation this legislative session.
Regulating PBMs is not the sole solution to keeping prescription drugs affordable and accessible for Washington families, but there’s no question that the unregulated and predatory practices of PBMs are making it much harder both for families and pharmacists to pay for the prescription drugs they need. Bringing PBMs into a regulatory framework will protect patients’ health and their wallet, while preserving their access to their needed medicines.
Please stand with your local drugstore in urging your state lawmakers to support the passage of SB 5857.
Jeff Rochon is the CEO of the Washington State Pharmacy Association.
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