Community Pharmacists Rally for PBM Transparency

The National Community Pharmacists Association (NCPA) is renewing its focus on transparency for the powerhouses that manage the prescription drug plans of more than 210 million Americans. Building on the success of efforts to strengthen regulations placed on pharmacy benefit managers (PBMs) as part of health care reform, the pharmacy group has endorsed a new bill, HR 5234, that promises to extend federal oversight of PBMs.

Coordinating with policymakers to push the bill forward is a top priority for NCPA, whose 42nd Annual Legislative and Government Affairs Conference concludes today in Washington, DC. Also on the agenda for this year’s conference is a second bill, HR 5235, which would exempt small pharmacies from the competitive bidding process for diabetic testing supplies.

In their meetings with elected officials following this morning’s rally and press conference, representatives from NCPA thanked lawmakers for backing previous pro-pharmacy measures and asked for their continued support in passing HR 5234 and 5235.

“We’re very excited about these bills,” said John Coster, RPh, PhD, NCPA’s senior vice president of government affairs. Bruce T. Roberts, RPh, NCPA’s executive vice president and chief executive officer, believes the bills reflect NCPA’s success in carrying out its mission—to have a stronger voice in government and regulatory affairs.

“It’s an exciting time for our members to be here and to be able to voice their concerns related to legislation that’s being considered, and also to make sure that we have a growing voice in Washington,” Roberts told the press in a media conference call Tuesday.

Sponsored by Rep. Anthony Weiner (D, NY), HR 5234 aims to curb conflicts of interest, discourage punitive auditing practices, and promote open communication between PBMs, patients, and providers.

If passed, the legislation would require PBMs to identify and update weekly sources for pricing and reimbursement benchmarks, update pharmacy product pricing files, and follow prompt pay provisions consistent with Medicare. Independent pharmacies would have a greater chance of participating in PBM networks, thanks to a regulation requiring PBMs to offer “non-discriminatory contracts.”

Similar language in HR 5234 addresses practices the NCPA has said are designed to box out competition from smaller, independently owned pharmacies. Under Weiner’s bill, for example, PBMs would not be allowed to impose mandates or offer incentives that require or encourage patients to choose specific retail, mail-order, or specialty pharmacies owned by the PBMs.

Stricter privacy laws are included as well, to deter the practice of plying patients through strategically timed letters and phone calls. According to Roberts and Coster, NCPA has documented hundreds of examples of such correspondence, which are currently under investigation by the Federal Trade Commission for possible conflicts related to market competition and patient protection laws.

HR 5234 also attempts to reform the pharmacy audit process through a host of new rules. Under the current system, PBMs use audit procedures Coster believes are “designed to harass pharmacists.” When conducting audits under the new bill, PBMs would be required to give pharmacies 15 days notice, provide the option of a written appeals process, limit audit periods to 1 year, and disclose audit recoupment to the plan sponsor. The bill also prohibits PBMs from extrapolating audit findings and imposing stricter standards for recordkeeping than those specified by state and federal law.

The measures that comprise the bill are an extension of President Obama’s health care reform bill, which established “groundbreaking transparency” for PBMs operating in the state-run health care exchanges that will begin in 2014, Coster said.

The contents of HR 5234 and HR 5235 are available for review through the Library of Congress Web site. For more information on the NCPA Annual Conference on National Legislation and Government Affairs, visit the NCPA online.