Protect community pharmacies, patients by advancing PBM reform
Gov. Josh Shapiro recently gave independent pharmacists a chance to breathe by curbing the unchecked power of Pharmacy Benefit Managers (PBMs)-middlemen in the drug supply chain.
While it’s a win for our state, community-oriented pharmacies continue to shutter nationwide at an alarming rate, leaving patients questioning how they will obtain their essential medicine. Reining in these middlemen on the federal level would give all patients and independent pharmacists an equal chance.
PBMs were initially created to manage prescription drug benefits on behalf of health insurers, with the goal of negotiating better prices for patients. However, over the years, the entities have gone off the rails because of a lack of transparency and regulatory guardrails. Fast forward to today and PBMs are gaming the system at the expense of patients and small businesses throughout the health care industry.
The ability of PBMs to steer patients towards certain drugs over others while also dictating access is a prime example.
By picking and choosing what medicines are covered by health insurance plans, the middlemen influence what drugs are available and at what price. The power also extends to determining which pharmacies patients can use, often guiding them away from independent, small business pharmacies to large chains affiliated with the PBMs themselves. Why? Bigger profits.
Small businesses like mine are also being squeezed through a PBM reimbursement scheme. Independent pharmacies are refunded at rates that are often less than the cost of acquiring and dispensing the medications. This practice, known as a “clawback,” significantly strains our already razor-thin budget margins.
And perhaps of most concern for individuals and families, middlemen muddy the waters of the doctor-patient relationship.
Because PBMs make bigger bucks off more expensive drugs, they use their influence to steer patients towards top dollar medications. Not only does this inflate costs, but according to an economic analysis, this behavior has a spillover effect on what medicine doctors prescribe patients.
It’s akin to buying a car or truck. On a car lot, salesmen are motivated to upsell buyers to get bigger commissions while the dealership is incentivized to flip cars quickly. Similarly, when PBMs are involved, health outcomes are not necessarily the only factors in the mix when picking a treatment regimen. As a result, independent pharmacies and patients lose.
Do we really want the U.S. health care system to mimic the operations of a used car lot?
A bipartisan group of federal lawmakers is advancing legislation that would erect guardrails and enhance transparency around these nefarious PBM practices. Examples include bills that would realign incentive structures to keep prices low for families and shine a spotlight on accounting practices that leave independent pharmacies with the short end of the stick.
As a pharmacist who fights tooth and nail to protect the well-being of my patients, I urge Sens. John Fetterman and Bob Casey, as well as Pennsylvania’s other elected officials in Washington, D.C., to support PBM reform. The legislative prescription is just what the doctor ordered.
Eric Abramowitz is the owner of Eric’s RX Shoppe in Horsham.