Latest news with #OhioPharmacistsAssociation
Yahoo
01-07-2025
- Business
- Yahoo
Ohio pharmacy measure will make closures ‘explode,' group says
A pharmacy manager retrieves a bottle of antibiotics. (Photo by) Compromise budget language hashed out this week by an Ohio House-Senate committee will make problems hurting Ohio pharmacies infinitely worse, the leader of a group that represents them said Thursday. He added that the Ohio Chamber of Commerce — which advocated part of the legislation — seemed blind to the effect it would have on member businesses by making it more difficult for employees to access medicine. As it works against a June 30 budget deadline, a House-Senate conference committee approved an amendment that keeps part of a bill meant to help ailing pharmacies but slashes another. The result, said Dave Burke, a pharmacist, former state senator, and executive director of the Ohio Pharmacists Association, will be that pharmacies will go from earning scant profits to none at all. 'It's any pharmacist's suicide bill,' he said Thursday. Ohio pharmacies have been in trouble for years. They've complained of high fees and low reimbursements from huge middlemen known as pharmacy benefit managers, or PBMs. Last year, Ohio lost 215 pharmacies and their total number dropped below 2,000 for the first time in memory, according to an online tracker launched by the Ohio Board of Pharmacy. As pharmacies disappear, they create a lack of access that is particularly hard on the poor, elderly and disabled. Not only do they get their medicine at what are often main-street businesses. They also get professional medical advice about chronic conditions like diabetes and high blood pressure. PBMs, the middlemen, decide which drugs are covered, and they use a non-transparent system to decide how much to reimburse pharmacies that dispense them. The three biggest control nearly 80% of the marketplace. As pharmacies close, Ohio Chamber blasted for siding with middlemen Each of those companies is part of a Fortune 15 health conglomerate that also owns a top-10 health insurer. CVS owns the largest retail pharmacy chain and all three own mail-order pharmacies. So, when the big PBMs decide reimbursements, impose rules and charge fees, they're doing so for their own pharmacies and their competitors. That's a glaring conflict of interest, their critics say. There have been abuses in Ohio. In 2018, the Ohio Department of Medicaid peeled back the curtain and learned that a year earlier CVS and UnitedHealth's PBM, OptumRx, charged taxpayers $224 million more for drugs than they paid the pharmacies that had dispensed them. The Medicaid department fired the PBMs. In 2022 it got rid of their hidden, seemingly arbitrary system of reimbursement in which the same companies sometimes pay 500 different prices for the same drug. Instead, prices are determined by a public survey published by the U.S. Centers for Medicare and Medicaid Services — the National Drug Acquisition Cost, or NADAC. With pharmacies no longer losing money on some drugs and making it on others, the Medicaid department set a $10 per-prescription dispensing fee to cover pharmacies' overhead. Even with the increased dispensing fees, an analysis said the state saved $140 million from the reforms. Ohio state Rep. Tim Barhorst, R-Fort Laramie, this year proposed to use the same arrangement in many non-Medicaid transactions. That measure made it into the Ohio House budget, but then ran into opposition in the Ohio Senate, where the Ohio Chamber had been telling members the dispensing-fee requirement was a tax. What emerged from the conference committee late Wednesday might have seemed like a compromise to its members. It kept the provision that drug reimbursements would be based on NADAC, the publicly available price list, but it got rid of dispensing fees. To Burke and other Ohio pharmacists, it's the worst of both worlds. Not only couldn't they profit from over-reimbursements under the traditional, non-transparent system, they also couldn't cover overhead from a fixed dispensing fee. Of the measure agreed to by the conferees, Burke said, 'That proposition only works with a second proposition — the dispensing fee. Because the bag, the bottle, the lid, the pharmacist, the tech, the lights, the heat and the air conditioning all have a cost. In any business model, whether it's medications, pizzas or cars… you can't buy ingredients for a dollar and sell pizzas for a dollar and stay in business.' He predicted that if it becomes law, there will be a mass exodus from the already depleted ranks of Ohio pharmacies. 'If pharmacies can't make any money — this legislation makes it so that you're not making any money at all — it would probably force the closure of the overwhelming majority of pharmacies in this state,' Burke said. 'Even a child mowing yards is not going to buy a dollar's worth of gas and accept a dollar to mow your yard.' Once conferees agree on a budget, Gov. Mike DeWine has the power to veto line-items in it. Burke said he hoped the governor would consider such a move. 'I think the governor's office would be well placed to consider a veto and we will be expressing our concerns that the legislation is flawed, and that if he doesn't, the amount of pharmacy closures in Ohio in the next weeks if not months will explode,' Burke said. Dan Tierney, DeWine's press secretary, was non-committal when asked about the matter. SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX 'We have not received final budget language but will be reviewing the final language when received,' he said in an email Thursday. Burke didn't accuse any of his former colleagues of ill-intent in agreeing to the measure. 'I think they believed that if they stepped in and said we'll make sure you get paid what you paid for the drug that will fix everything,' Burke said. 'But this legislation takes everything you made a profit on and brings it to zero.' However, he did say he was mystified about the Ohio Chamber's reasons for intervening in the matter. 'I don't know where the chamber adopted its stance from, but it's hard for me, as an independent business owner, to understand why major employers would want to increase their employees' difficulty getting medications.' Burke was incensed that the Ohio Chamber would call dispensing fees — payments to cover overhead — a tax. 'It's amazing to me that the chamber should take the position that business owners should not make a profit,' he said. 'I thought the Ohio Chamber was all about profit, pro-business and competitive markets. But they've adopted the position that this particular sector of business owners should not make any money. They consider the dispensing fee to be a tax. So apparently, any profit that any business makes is a tax. Maybe they've gone socialist over there. I don't understand. Maybe they're not looking at their own pharmacy benefit with any understanding.' The Ohio Chamber didn't immediately respond Thursday to a request for comment. But earlier this week, Senior Vice President Rick Carfagna said the goal was to protect Ohio businesses from paying too much to underwrite employees' drugs. There are, however, questions about the body's relationship with the giant conglomerates that own the PBMs. For example CVS Health was a 'presenting sponsor' of the Chamber's 2024 Healthcare Summit, Among the questions the Ohio Chamber didn't immediately respond to was how much CVS paid to sponsor the event — or how much the chamber had received from the big-three conglomerates over the past five years. In earlier responses, Carfagna didn't address the growing number of pharmacy deserts in Ohio, or that struggling independent and small-chain pharmacies are themselves small businesses that the Ohio Chamber says it wants to protect. Burke said all the Ohio Chamber's members will be harmed if the conference committee language becomes law and mass closures result. That would mean sicker employees with difficulties getting medicine. 'I hope the Chamber actually goes and speaks with the people they're supposed to represent and see if this policy position is reflective of the way they want to treat their employees,' Burke said. SUPPORT: YOU MAKE OUR WORK POSSIBLE
Yahoo
25-04-2025
- Business
- Yahoo
New guidelines proposed for pharmacy benefit managers included in state budget
Apr. 25—After legislation that would have regulated pharmacy benefit managers failed in last year's Ohio General Assembly, new guidelines are being proposed in the state budget bill. "Pharmacists believe that PBMs can provide significant value to our health care system," said Jeff Bates, dean and professor of pharmacy practice at Cedarville's School of Pharmacy. "They must embrace, however, approaches that are fully transparent and fair. Accountability is key in this space." PBMs are companies that often work with large employers, health insurers and/or other payers for health care to help to manage prescription drug benefits, Bates said. In negotiating on behalf of those clients, PBMs influence how much drugs cost through negotiating rebates with the drug manufacturers and they can also set the reimbursement rates for pharmacies, the Ohio Pharmacists Association says. Whether or not to regulate Those looking to impose regulations on PBMs are concerned unregulated PBMs are contributing to growing pharmacy closures, which can impact access to health care. Opponents say imposing certain requirements for PBMs could raise health care and prescription prices. The provisions for PBMs the Ohio House approved in the state budget bill for fiscal year 2026-2027 are similar to regulations included in H.B. 505, or the Community Pharmacy Protection Act, which failed to make it out of committee in the last Ohio General Assembly. Some of the provisions recently approved by the House include: — PBMs would be required to reimburse Ohio-incorporated pharmacies that dispense a drug product for the "actual acquisition cost," i.e., the amount paid to the drug wholesaler, plus a minimum dispensing fee determined by the Superintendent of Insurance. — PBMs would be prohibited from reimbursing an Ohio pharmacy less than the amount the PBMs reimburse their affiliated pharmacies for providing the same drug product. — An Ohio pharmacy would be allowed to decline to provide a drug product if the pharmacy would be reimbursed less than the required amount. — PBMs would be prohibited from retaliating against Ohio pharmacies in regard to these rules. "The problem that's being resolved here is PBMs are both the price maker and the price taker," said David Burke, executive director of the Ohio Pharmacists Association, saying these are anti-competitive business practices. PBMs set both the contractual cost of how much drugs cost for a pharmacist to stock and then what a pharmacist is paid when they sell the drugs to a customer, Burke said. "The amendment sets an actuarial rate on both drugs and pharmacy services," Burke said. "...This is the exact same policy that Ohio Medicaid implemented several years ago with a single PBM, where it wanted to actually reimburse pharmacists at-cost for drugs and pay them at-cost for dispensing those drugs." A minimum dispensing fee A minimum dispensing fee is a measure to try to bridge the gap between what PBMs reimburse the pharmacies they own versus the reimbursements paid to independent pharmacies, proponents say. In one analysis, chain pharmacies were paid $46.87 on average for dispensing a 90-day supply of atorvastatin, a drug for treating high cholesterol and triglyceride levels, while an independent pharmacy was paid $1.90, according to the American Pharmacy Cooperative. Mandating dispensing fees could increase costs for consumers, the Ohio Chamber of Commerce says. "It was a bit of a surprise to see that make it into the budget," said Molly Mottram, director of health care policy at the Ohio Chamber of Commerce. A dispensing fee would be estimated anywhere between $10 to $15 in addition per prescription, Mottram said. "We can't make the assumption that PBMs are going to absorb those costs," , Mottram said. The chamber is concerned PBMs would to shift the dispensing fee costs down to employers. "Then that's going to shift down to the employee through cost of increasing premiums, deductibles and whatnot," Mottram said. The dispensing fee could help small pharmacies, but it risks higher overall costs that could adversely hurt state finances and consumers, said Rea Hederman Jr., executive director of the Economic Research Center and vice president of policy at the Buckeye Institute. "It would do this by mandating minimum dispensing fees while restricting PBMs' reimbursement flexibility," Hederman said. By contrast, reforms that boost transparency and competition could benefit consumers and businesses, he said. "Ultimately, there is a trade-off between helping one group of businesses and keeping overall pharmacy costs down for everyone," Hederman said. "We understand that pharmacy closures unfortunately happen but blaming PBMs is not based on facts. PBMs recognize the vital role pharmacies play in creating access to prescription drugs for patients," the Pharmaceutical Care Management Association said in a statement.
