End the obvious conflicts of interest of a manufacturer exerting a controlling interest in a PBM or when a PBM owns a controlling interest in a retail pharmacy, which is most egregious in the case of CVS Caremark.
Prevent PBMs from forcing participating pharmacies into certain contract terms as a condition of participating in a particular pharmacy network.
However, the bill could be improved. It caps the amount the carrier plan may pay a PBM for a prescription drug at the drugs average manufacturer price. That price does not come close to the retail pharmacy acquisition cost of a prescription drug. Further, PBMs would likely keep part of the AMP payment made by the carrier. The Government Accountability Office studied a similar AMP proposal in Medicaid and concluded it would pay pharmacies 36 percent below their costs.
Rather than dispensing drugs at a significant financial loss, pharmacies might be forced to leave the FEHBP program, undermining patient access. In addition to more equitable reimbursement, we urge including a provision protecting pharmacies from aggressive and unnecessary auditing practices of PBMs.
A new report from Change to Win, a labor coalition, illustrates the costs of the current system. They found that FEHBP patients paid more on 85 percent of all drugs that are currently covered under CVS Caremarks Health Savings Plan for the uninsured. In other words, according to the survey, patients without insurance paid less for these drugs than FEHBP patients shopping at a CVS with CVS Caremark-administered coverage!
By taking the best aspects and strengthening others, Lynchs bill can make the FEHBP more cost-effective, transparent and practical. Across the U.S., public and private sponsors of health plans are reducing costs by adopting similar policies demanding better transparency. TRICARE estimates savings of $1.67 billion, New Jersey projects savings of $559 million over six years, and Texas estimates cutting costs by $265 million.
This important step will mean whats good for the goose is truly good for the gander.
Bruce T. Roberts is executive vice president and CEO of the National Community Pharmacists Association.
Visitors get their first look at the American Veterans Disabled for Life Memorial, which opened to the public on Monday, Oct. 6, 2014. The new memorial is located off Independence Ave. SW between the Rayburn House Office Building and HHS. Buy photo here.