NCPA backs legislation to rein in PBM practices, preserve seniors' access to diabetes supplies

May 14, 2010

The National Community Pharmacists Association (NCPA) has endorsed two legislative bills that are aimed at controlling healthcare costs by requiring greater transparency of pharmacy benefit managers (PBM) and ensuring that Medicare patients with diabetes can continue to obtain their medical supplies from their local community pharmacies, during its 42nd annual National Legislation and Government Affairs Conference held in Washington last week.

The National Community Pharmacists Association (NCPA) has endorsed two legislative bills that are aimed at controlling healthcare costs by requiring greater transparency of pharmacy benefit managers (PBMs) and ensuring that Medicare patients with diabetes can continue to obtain their medical supplies from their local community pharmacies, during its 42nd annual National Legislation and Government Affairs Conference held in Washington last week.

The PBM Audit Reform and Transparency Act of 2010 (H.R. 5234), introduced May 6, 2010, by U.S. Representatives Anthony Weiner (D-N.Y.) and Jerry Moran (R-Kan.), would ensure greater PBM transparency and proper operation requirements. This bill would limit ownership conflicts of interest, require greater PBM disclosure with patients and plan sponsors, and discourage abusive pharmacy auditing practices.If H.R. 5234 is enacted, PBMs will no longer be able to mandate that patients use a specific pharmacy (retail, mail, or specialty) if the PBM has an ownership interest in that pharmacy, according to John Coster, NCPA senior vice president of government affairs. It would prohibit offering incentives to encourage patients to use only the PBM-owned pharmacy.

In addition, the PBM will need to disclose to plan sponsors in an annual report the number and total cost of prescriptions under the contract filled at mail and retail pharmacies; average payments under the contract per prescription made to mail and retail and the average amount per prescription the PBM received; overall percentage of generics dispensed at mail and retail; and the percentage and number of patients who were switched to a more costly drug.

Pharmacies would have to be given a 15-day prior notice before audits, would have the opportunity to appeal through a written appeals process, and would only be audited over a period of 1 year. The PBM would have to disclose audit recoupment to the plan sponsor. Patients would also be protected by restrictions on the sale/utilization of claims data and other patient information.

NCPA is also backing the Medicare Access to Diabetes Supplies Act (H.R. 5235), introduced May 6, 2010, by U.S. Representatives Peter Welch (D-Vt.) and Mike Rogers (R-Mich.), which would exempt blood glucose self-testing equipment and supplies furnished by small retail community pharmacies from Medicare competitive acquisition programs.

“This legislation allows seniors to continue obtaining essential medical supplies like diabetes testing strips from their local community pharmacy,” said Bruce T. Roberts, RPh, NCPA executive vice president and CEO. “The current competitive bidding progam favors larger healthcare providers at the expense of smaller ones like community pharmacies. As a result many seniors who get these supplies from community pharmacies could be forced to travel many miles or go through mail order without the face-to-face consultation that helps to maximize health outcomes.”