Newsline

Newsline , Society

Pharmacy Middlemen Dodge FTC Competition Probe in Split Vote

Posted on Friday, February 18, 2022
|
by Outside Contributor
|
16 Comments

The Federal Trade Commission Thursday failed to reach consensus on launching a study into the reimbursement rates set by the entities that manage prescription drug benefits on behalf of health insurers and Medicare Part D plans.

The FTC in a 2-2 party-line vote decided to not open a probe into pharmacy benefit managers (PBMs) and whether their drug price setting practices unfairly favor PBM-affiliated pharmacies at the expense of independent or specialty ones.

The move comes despite fervent demands from pharmacy and patient advocacy groups to look into a complex component of the health-care industry that has traditionally remained without strong federal oversight.

“I am really disappointed by this outcome,” FTC Chair Lina Khan, who backed the motion to launch a probe, said immediately after the vote Thursday. She noted that the commission has “for months been building a record with testimony from both patients and pharmacies alike underscoring the real urgency and life and death at stake in some instances.”

Independent pharmacy representatives testified earlier in the FTC meeting that low reimbursements rates PBMs set for pharmacies have threatened to put community pharmacies out of business amid the demands of the pandemic.

The Republican commissioners—Noah J. Phillips and Christine Wilson—voted against the motion, arguing that while the existing plans for a study include how PBM practices “may disadvantage independent or specialty pharmacies,” they do not adequately call for measuring how PBMs may influence out-of-pocket drug costs for consumers.

Concerns on pharmacy middlemen’s market impacts have grown in recent years, as the largest PBMs have integrated with retail pharmacies and health plans including CVS-AetnaCigna-Express Scripts and UnitedHealth-OptumRx. Independent pharmacy groups argue that PBM-owned or affiliated pharmacies often push patients to get drugs through their own facilities, turning costumers away from smaller, local ones.

‘Long Overdue’

Pharmacy and patient advocacy groups have long called for the federal government to take action against PBM practices that they say drive up consumer costs and limit business to independent pharmacies.

Formularies, or lists of drug products covered by payers, are set by PBMs and limit patient options, pharmacists say. They have also criticized practices like spread pricing, in which PBMs keep a portion of the amount paid to them by health plans instead of giving the full amount to pharmacies.

Scott Knoer, CEO and executive vice president of the American Pharmacists Association, said in testimony at Thursday’s meeting that a federal probe into PBMs was “long overdue.”

“Anti-competitive PBM practices are putting independent pharmacies out of business and creating pharmacy deserts in minority and underserved communities, where the neighborhood pharmacy may be the only health-care provider for miles,” he said.

No PBM representatives were present at Thursday’s meeting, though the Pharmaceutical Care Management Association, the leading PBM trade group, has said that its members work to reduce patient drug costs, and that drugmakers are the ones responsible for setting prices.

“Drug manufacturer price setting is the root cause of high drug costs, putting a strain on patients and forcing them to make difficult decisions about their drugs,” the group said in an emailed statement Thursday. “PBMs are holding drug companies accountable by relentlessly negotiating the lowest possible cost on behalf of patients, and are driving and delivering local competition that patients are demanding.”

JC Scott, president and CEO of the PCMA, said in a Feb. 15 post that through “expertise, data, and technology, PBMs pave the way for a seamless pharmacy experience helping patients to get and stay on their medications and through the process, lead healthier lives.”

A Divided Commission

FTC Commissioner Phillips said that while he supports examining PBM practices, the proposed study “was not designed to assess the competitive effects” of PBM contracts with pharmacies.

The study also “would not tell us how the contractual provisions at issue might impact drug prices overall, or the out-of-pocket drug costs consumers pay when they go to the pharmacy to get their prescriptions,” he said. “To me, the most important things are the amount of money that Americans are spending on prescriptions, and the kind of care they are getting.”

Wilson echoed these remarks, noting she didn’t receive the latest version of the study proposal until late Wednesday night. She added she would like a study to address whether the price and quality of medications vary from an independent pharmacy to a PBM-affiliated one.

But Rebecca Slaughter, a Democrat, who voted for the study, said it would have been a “starting point” for future probes into PBMs.

“There are many iterations of a PBM study that I could and would enthusiastically support,” Slaughter said. She added that not launching the study would be “a shame for the American people.”

National Community Pharmacists Association CEO Douglas Hoey blasted Phillips and Wilson for their votes Thursday, arguing that they “just let the worst actors in the market off the hook.”

“After hearing hours of testimony by community pharmacists and patients, all of whom painted the same shocking picture about PBM abuse, and not a single witness there to defend the PBM industry, it is inexplicable that two members of the commission could vote against the study,” Hoey said in a statement.

Share this article:
Subscribe
Notify of
guest
16 Comments
Most Voted
Newest Oldest
Inline Feedbacks
View all comments
Janet
Janet
2 years ago

I recently had a doctor’s appointment and when to the pharmacy to pick up my 14 pain pills that he ordered. The pharmacy told me that my Part D supplemental prescription plan would only allow me to have 7 pills. I ended up paying cash for the prescription so that I would have all the pills available if needed. I have taken this medication on and off for over 30 years as I suffer from chronic pain. I do not abuse it and I am not addicted, but there are times that I need to take them. I have never had the pharmacy tell me that I was not allowed to fill the prescription as written. I have always been given a prescription for 30 or more and they can last me for months to over a year depending on what is happening with my body. I don’t understand how the pharmacy or supplemental plan can refuse to fill a prescription as ordered and written by a pain management professional (physiatrist), but things are getting insane.

Sharon Ormsby
Sharon Ormsby
2 years ago

Getting rid of the middle men is a dream! I would love it. We had a friend who did this work a long time ago. He would take samples by every doctor’s office and show them the demonstrations of each medicine, vitamin, etc. It took away from the patients’ time with the doctors. However, the doctors loved the samples, because they could give them to the patients instead of writing the prescriptions, because the drugs costs so much! Don’t know if our friend Jim, knew a lot of doctors would do this or not. However, it would be nice to get rid of this line of work.

R.S. Helms
R.S. Helms
2 years ago

This gives me some fuel and hope for the article I am writing about CVS-Etna-CVS Healthcare. they are punishing me and my criticism of their practice of “Pharmacy Team” Rescheduling practices to force me to pay retail from a local pharmacy. and their strategies are endorsed by Medicare (Obama Care) currently I have had to go without a maintenance medication for three months before Atna Silver script will pay for it, even after switching insurance plans and winding up with Silver Script, not knowing Atna was CVS and Silver Script is CVS healthcare at a much higher rate. Great Article even if it was a re-post…

Brain
Brain
2 years ago

Thank you AMAC for paying attention to things that actually matter to AMERICANS. Seems so rare these days. (We are members and I’ll give membership to my siblings fit their birthdays!!!

MT
MT
2 years ago

Wonder who received the majority of the money in this.

Judy Layman
Judy Layman
2 years ago

Evidently, a lot more homework to do. The disappointment in the medical and pharmaceutical system is growing.
Thant you for keeping us informed.

Janet
Janet
2 years ago

I recently had a doctor’s appointment and when to the pharmacy to pick up my 14 pain pills that he ordered. The pharmacy told me that my Part D supplemental prescription plan would only allow me to have 7 pills. I ended up paying cash for the prescription so that I would have all the pills available if needed. I have taken this medication on and off for over 30 years as I suffer from chronic pain. I do not abuse it and I am not addicted, but there are times that I need to take them. I have never had the pharmacy tell me that I was not allowed to fill the prescription as written. I have always been given a prescription for 30 or more and they can last me for months to over a year depending on what is happening with my body. I don’t understand how the pharmacy or supplemental plan can refuse to fill a prescription as ordered and written by a pain management professional (physiatrist), but things are getting insane.

Sharon Ormsby
Sharon Ormsby
2 years ago

Getting rid of the middle men is a dream! I would love it. We had a friend who did this work a long time ago. He would take samples by every doctor’s office and show them the demonstrations of each medicine, vitamin, etc. It took away from the patients’ time with the doctors. However, the doctors loved the samples, because they could give them to the patients instead of writing the prescriptions, because the drugs costs so much! Don’t know if our friend Jim, knew a lot of doctors would do this or not. However, it would be nice to get rid of this line of work.

R.S. Helms
R.S. Helms
2 years ago

This gives me some fuel and hope for the article I am writing about CVS-Etna-CVS Healthcare. they are punishing me and my criticism of their practice of “Pharmacy Team” Rescheduling practices to force me to pay retail from a local pharmacy. and their strategies are endorsed by Medicare (Obama Care) currently I have had to go without a maintenance medication for three months before Atna Silver script will pay for it, even after switching insurance plans and winding up with Silver Script, not knowing Atna was CVS and Silver Script is CVS healthcare at a much higher rate. Great Article even if it was a re-post…

Brain
Brain
2 years ago

Thank you AMAC for paying attention to things that actually matter to AMERICANS. Seems so rare these days. (We are members and I’ll give membership to my siblings fit their birthdays!!!

MT
MT
2 years ago

Wonder who received the majority of the money in this.

Judy Layman
Judy Layman
2 years ago

Evidently, a lot more homework to do. The disappointment in the medical and pharmaceutical system is growing.
Thant you for keeping us informed.

An older blonde women laughing in the kitchen with a grey haired man.
AMAC’s Medicare Advisory Service
The knowledge, guidance, and choices of coverage you’re looking for. The exceptional service you deserve.
The AMAC App on 3 different iPhone
Download the AMAC App
The AMAC App is the place to go for insightful news wherever you are and whenever you want.
Joe Biden speaking with attendees
NEW YORK - OCT 10:American homeless sleeps in New York city subway on October 10 2009.A 2013 report show that the number of homeless people recorded in NYC topped 50,000 for the first time.
Former President of the United States Donald Trump speaking with attendees at the 2023 Turning Point Action Conference at the Palm Beach County Convention Center in West Palm Beach, Florida.
gen z and boomers; election - pick your side poster

Stay informed! Subscribe to our Daily Newsletter.

"*" indicates required fields

16
0
Would love your thoughts, please comment.x
()
x

Subscribe to AMAC Daily News and Games