Bill Would Crack Down on Predatory Practices By Pharmacy Benefit Managers

Independent pharmacists and community health advocates in Wisconsin are rallying behind legislation to crack down on third-party companies that dictate how patients can access their prescriptions.

Pharmacy benefit managers, or PBMs, serve as brokers between drugmakers, health insurance companies and pharmacies. The three largest PBMs manage nearly 80% of all prescriptions filled in the United States, according to a Federal Trade Commission report from July.

PBMs are often part of larger health care conglomerates that own a health insurer and retail pharmacy chain. The consolidation, according to the FTC report, means PBMs “exercise significant control over which drugs are available, at what price, and which pharmacies patients can use to access their prescribed medications.”

The bill from Senate President Mary Felzkowski, R-Tomahawk, and state Rep. Todd Novak, R-Dodgeville, would push back on predatory practices by the companies that discriminate against independent pharmacies and can lead to higher patient costs.

The legislation requires PBMs to allow patients to use any licensed pharmacy in the state without facing penalties. It also requires the companies to pay pharmacists a dispensing fee at least equal to what the state pays through Medicaid programs. PBMs would be required to pay pharmacies within 30 days, cutting down on long delays for drug reimbursement.

Speaking at a press conference Tuesday, Felzkowski said she’s hopeful the issue will gain traction among lawmakers after a previous version of the bill failed to make it out of committee last year.

“On the campaign trail last year, we heard loud and clear from constituents that health care in Wisconsin is not working for our constituency, and we have also heard that loud and clear for our employers,” Felzkowski said.

Last session, the bipartisan bill was opposed by a number of health insurance companies, the Wisconsin Counties Association and Wisconsin Manufacturers & Commerce.

In testimony submitted to lawmakers last session, the Alliance of Health Insurers and Wisconsin Association of Health Plans wrote that the bill would have “significant harmful and far-reaching consequences for the cost and quality of prescription drug management in Wisconsin.” The groups claimed the added regulations would increase costs for employers in the state and do little to address the high cost of prescription drugs.

Pharmacists, advocates say PBM reforms would protect patients

This year, backers named the legislation “Cole’s Act” in memory of 22-year-old Cole Schmidtknecht, a college student who died last year from an asthma attack just days after he was forced to forego the purchase of his inhaler because of an unexpected price increase.

Bill Schmidtknecht, Cole’s father, said at the press conference that his son’s PBM removed the medication from their list of covered medications without warning.

“His Advair went from $66 to $540,” Schmidtknecht told reporters. “He was forced to choose between buying his needed medicine and paying his rent. Wisconsin has the power to take a stand against these PBM abuses.”

Larry Crowley, a pharmacist from Dodgeville, was one of several independent pharmacy owners who spoke in favor of the bill. He said local pharmacists are reimbursed for dispensing prescriptions at “unsustainable rates” that are below what PBM-owned pharmacies receive.

He said benefit managers also decide what medications are covered based on profits instead of what’s best for patients.

“Every day in my pharmacy, I witness patients facing exorbitant co-pays, sometimes exceeding $500 for medications they cannot afford,” Crowley said at the press conference. “These patients are confused, they’re overwhelmed and they’re forced into impossible decisions about their health.”

The Wisconsin Primary Health Care Association, which represents the state’s federally qualified health centers, also supports the bill. Richelle Andrae, the group’s associate director of government relations, said at the press conference that PBMs target health centers with poor reimbursement rates for participating in a federal program to lower prescription drug costs for low-income patients.

It’s an issue Democratic Gov. Tony Evers proposed fixing in his state budget proposal. The governor’s budget also included proposals to increase regulation on several entities within the prescription drug supply chain, including pharmacy benefit managers.

At the federal level, President Donald Trump and Health and Human Services Secretary Robert F. Kennedy Jr. have both said the new administration will aim to crack down on unfair pricing practices by PBMs.

Listen to the WPR report

Wisconsin bill would crack down on predatory practices by pharmacy benefit managers was originally published by Wisconsin Public Radio.