Pill Bottle

Ohio lawmakers received testimony this week from 11 supporters of a measure that would put tighter restrictions on health insurance and pharmacy benefit management companies.

Pharmacists, lawyers and advocates urged the state House Health Committee to support House Bill 63, saying it will help reduce costs for patients and allow pharmacists to share important information with their customers.

Currently in Ohio, pharmacy benefit management firms can dictate how much a pharmacy can charge a customer. Antonio Ciaccia, director of government and public affairs for the Ohio Pharmacists Association, shared an example from one of his members.

A customer needed medication for a vitamin deficiency. The pharmacy listed the drug at $92, but the PBM ordered the pharmacist to charge more than $115. Afterward, the PBM took $55 for the claim in a clawback recovery. That meant both the customer was overcharged and the pharmacy took a loss on the sale.

Further, the pharmacist was unable to refer the customer to a cheaper alternative because of their contract with the PBM.

“Keep in mind that every extra dime that patient has to spend on their prescriptions increases the likelihood that they forego the medications altogether,” Ciaccia said in written testimony to the committee. “In pharmacy, we refer to this as prescription abandonment. Prescription abandonment and overall medication nonadherence is a huge contributor to hospital readmissions.”

The committee did not hear from any speakers during the Tuesday hearing. Nor did it receive any testimony from opponents to the bill.

In a release touting his bill, state Rep. Scott Lipps, R-Franklin, said the proposal would stop such practices.

“Gov. (Mike) DeWine and his administration are keenly aware of the millions of dollars PBMs have siphoned out of Ohio,” Lipps said. “It is time for all of us, including the legislature, managed care organizations and Medicaid to work together and fix this.”

David Balto, a Maryland attorney and former staffer with the U.S. Department of Justice and Federal Trade Commission, said PBMs represent one of the least regulated sectors of the American healthcare system.

PBMs do not offer transparency or consumer choices, he noted. That leads to higher costs and higher profits.

“The lack of enforcement, regulation and competition has created a situation where PBMs freely engage in anticompetitive, deceptive, and fraudulent behavior that harms consumers, employers, unions, and pharmacists,” he said in his testimony.

Allie Jo Shipman, a pharmacist and associate director for state government affairs with the National Community Pharmacists Association, said the issue affects hundreds of small businesses in Ohio. The NCPA represents more than 500 community pharmacies in the state, and because they do not have the buying power of large national chains, they are forced to accept agreements where they must overcharge consumers and not consult with them about other options.

If a pharmacist breaks the contract, she said, they could lose business and patients without other options may not be able to get the medications they need.

State Rep. Derek Merrin, R-Monclova Township, the committee chairman, said additional testimony and discussion will take place at the panel’s next meeting.