A national infrastructure bill is closer to passing than any has been in years—and that could be good news for pharmacists. While the connection between roads and water systems and independent pharmacies appears obscure, it makes sense for legislators.
Negotiators have been trying to find ways to make the infrastructure bill budget-neutral by cutting costs in other programs. One way could be eliminating spread pricing. The National Community Pharmacists Association has encouraged legislators to "include language to prevent abusive pharmacy benefit manager spread pricing and related practices in Medicaid managed care, improve transparency, and reasonably reimburse pharmacies."
Under spread pricing, pharmacy benefits managers (PBMs) charge health-plan sponsors more than they pay pharmacies to dispense a drug. The difference or spread is the PBM's profit. A number of states have determined that spread pricing significantly increases the cost of drugs in Medicaid programs, and federal legislators have argued that the practice increases costs for Medicare substantially, so eliminating will save the government money that could go toward the infrastructure bill.
"Spread pricing is among the most egregious PBM practices contributing to higher drug costs," said Karry La Violette, NCPA senior vice president of government affairs.
Even if the federal government does not restrict or eliminate spread pricing, states may. A unanimous Supreme Court decision upheld an Arkansas law regulating PBMs in December, opening the way for more states to regulate PBMs regardless of the type of health plan or its regulation. The decision clarified that a federal preemption that restricted state regulation of self-funded insurance plans, which are common among mid-sized and large companies, did not apply to PBMs.
Since the ruling, more than 200 state bills have been introduced to regulate PBMs, and many of them include language that specifically protects independent pharmacies. Community pharmacists have said for years that PBMs take advantage of their size and affiliation with insurers and chain pharmacies to squeeze independent pharmacies and lock them into highly unfavorable arrangements. Arkansas, Ohio, Georgia, Kentucky, Louisiana, Pennsylvania, New York, and Virginia have already banned spread pricing in their Medicaid programs.
The content contained in this article is for informational purposes only. The content is not intended to be a substitute for professional advice. Reliance on any information provided in this article is solely at your own risk.
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