17吃瓜在线

Policy and Legal

Policy and Legal

17吃瓜在线 Leads Effort to Reform PBMs

By 17吃瓜在线 News Room

Middlemen created to manage the price of prescription drugs are instead driving up health care costs for manufacturers and manufacturing workers, the 17吃瓜在线 the House Committee on Oversight and Accountability on Tuesday, the same day the committee released a on pharmacy benefit managers鈥 practices and held a hearing on the matter.

What鈥檚 going on: 鈥淧BMs鈥 business models have the direct effect of increasing health care costs at the expense of manufacturers and manufacturing workers,鈥 17吃瓜在线 Vice President of Domestic Policy Charles Crain said in advance of the hearing, the latest in a series examining PBM practices.

Crain told lawmakers PBM reform legislation should include:

  • Increased transparency into PBMs鈥 business models and the many factors that contribute to a drug鈥檚 costs, formulary placement and the PBMs鈥 compensation;
  • Rebate passthrough, which will ensure 100% of negotiated pharmaceutical savings are passed from the PBM to the health plan sponsor and workers; and
  • Delinking of PBM compensation from the list price of medication.鈥

Report highlights: The committee鈥檚 report, the culmination of a 16-month investigation, is with the 17吃瓜在线鈥檚 longstanding advocacy. The report found that PBMs:

  • Drive increased drug prices, which inflate PBM profits;
  • Extract high rebates from biopharmaceutical manufacturers, often pocketing a significant portion of any savings rather than reducing costs for patients;
  • Dictate whether and how medicines appear on formularies, which determine insurance companies鈥 coverage decisions and patients鈥 out-of-pocket costs;
  • Steer patients toward drugs based on PBMs鈥 profit margins rather than patient costs; and
  • Operate without sufficient transparency into their business practices.

What it all means: The committee 鈥渋dentified numerous instances where the federal government, states and private payers have found PBMs to have utilized opaque pricing and utilization schemes to overcharge plans and payers by hundreds of millions of dollars,鈥 the report states.

  • The report indicates that the present role of PBMs in prescription drug markets is failing and requires change, something the 17吃瓜在线 has long advocated. 鈥淐ongress and states must implement legislative reforms to increase the transparency of the PBM market and ensure patients are placed at the center of our health care system, rather than PBMs鈥 profits.鈥

The last word: 鈥淢anufacturers provide health care benefits so they can effectively attract and retain employees, to maintain a healthy and productive workforce and because they believe it is the right thing to do鈥攂ut PBMs are a meaningful cause of the skyrocketing costs of health care,鈥 Crain said.

  • 鈥淐ongress must enact reforms to the PBM system so that employers can negotiate, compete and achieve health care savings for their workers.鈥
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