Just like derivatives prior to the meltdown of the banking industry in 2008, the transactions conducted by pharmacy benefit managers (PBMs) in filling your prescription today are convoluted and mysterious — yet they're wreaking havoc on our everyday lives. But ask anyone shopping in a Walgreens as he's waiting for his prescription to be refilled what a PBM is or where the independent pharmacy is, and chances are you'll get a shrug of the shoulders. And that's just the problem.
PBMs are to the pharmacy industry what financial engineering companies were to the banking industry before the financial crisis of 2008. They insert themselves between the patient and/or employer and the provider of the prescription: the pharmacist. They demand that the pharmacist not discuss or disclose to the patient or employer any part of the financial transaction other than the co-payment, as they ratchet down the reimbursement to the pharmacist while escalating the invoice to the employer ... and it's Katie, bar the door, should the two ever meet! At the same time, the pharmacist is paying more and more for the prescription drug from his or her wholesaler — and only three wholesalers control 90% of the drug distribution in this country.
The bottom line is that pharmacists have to pay higher prices to wholesalers for drugs and at the same time accept smaller reimbursement payments from insurers. They're getting squeezed from both sides, the buy and the sell, yet we as patients or employers don't get the juice; the PBMs do.
With drug profits diminishing, pharmacists must devote more attention and importance to other revenue streams — such as packaged food, liquor, cigarettes, and household and seasonal products imported from China.
This trend is driven in large part by the self-feeding business of PBMs, which is going on inside a black box that no one understands, not even your legislator, since one of the country's largest political action contributors (PACs) is PCMA, Pharmaceutical Care Management Association, whose members include the PBMs.
There's absolutely no transparency in the transaction between the patient and/or employer or pharmacist. This has a big impact on the price and availability of drugs, and the amount of attention a pharmacist can devote to professional pharmacy practice, i.e., taking care of you, the patient.
The result is a pharmacy industry that operates more like the retail business than a profession. We as consumers are so used to the phenomenon that we hardly even notice. But think about it: You don't expect to go to your doctor's office and pick up an extension cord, a fifth of bourbon, a cheap toy for the kid, and a box of Hostess donuts while you wait in the waiting room, do you? No. In fact it would be unthinkable to expect our doctors to set up a cash register at the door and stock shelves with consumables — especially unhealthy items — just so they can stay in business and, by the way, practice medicine.
The question is, will this grossly inequitable practice come to the surface, as issue of derivatives did four years ago? Will legislation be enacted to correct it, or will the industry make changes of its own accord in response to public outrage?
Or will PBMs continue to quietly deprofessionalize the pharmacy profession and reduce the quality of healthcare for us all, while we blindly peruse the drugstore aisles for candy, tobacco, or alcohol, and get our prescriptions out of a vending machine?
And that's not a metaphor: Some big chains are actually working on plans to install machines to dispense your pills. If that happens, your pharmacy "care" literally will be reduced to a pill-filled box, whose only communication to you is "Insert payment here" — and if you have a problem, call the Geek Squad.