Illinois pharmacies are supporting House Bill 465, which would establish new state oversight of pharmacy benefit managers if signed into law by Gov. J.B. Pritzker.
Garth Reynolds, executive director at Illinois Pharmacists Association, said the bill establishes an oversight enforcement mechanism for pharmacy benefit managers in Illinois for the first time.
“Pharmacy benefit managers are subcontractors of health insurance, mainly the medical side,” Reynolds said. “Being the subcontractors, they have not really fit into the current insurance code the way it is in Illinois.”
Reynolds said pharmacy benefit managers have been able to establish reimbursement rates, contract terms and formulate decisions with no oversight or regulation.
“Whereas, if you look at health care, health care is one is the most regulated industries,” Reynolds said. “To have an unregulated segment having an impact on a heavily regulated segment has really given the pharmacy benefit managers an extreme market and financial advantage for themselves and not as much for the customers and patients they’re serving.”
The Pharmaceutical Care Management Association, which represents pharmacy benefit managers, has disputed such claims. The association has said pharmacy benefit managers are “projected to save employers, unions, government programs and consumers $654 billion on drug benefit costs over the next decade.”
By establishing a regulatory system, Reynolds said it empowers the state's Department of Insurance to take oversight and responsibility for the business practices of pharmacy benefit managers, requiring them to provide information about how money is being spent.
“As pharmacy providers, we always have to tell them exactly all the pricing and data and information,” Reynolds said. “PBMs didn’t have to do that. It's very interesting to see the pieces of the pie and how little of that is actually getting to the pharmacy providers.”
Reynolds said more than 170 pharmacies have closed in Illinois in the last three years because of pharmacy benefit managers and other issues in healthcare.
“I can't point at every single one because of [pharmacy benefit managers], but with the issues that are going on in Medicaid, the issues that are going on in private, commercial insurance and the issues on a federal level of Medicaid, they all have the same root cause and that's [pharmacy benefit managers],” Reynolds said. “They're devastating community pharmacies.”