Lonny Wilson, DPh NCPA president

Do pharmacists and patients really benefit when PBMs are in the equation?

	I recently began a 1-year term as president of the National Community Pharmacists Association, and want to raise awareness about issues faced by independent community pharmacy owners like myself and the patients we serve that should be addressed. As Americans, we encounter middlemen in our economy on a daily basis, though we may not think of them in this way.

	A supermarket is a middleman between the consumer and the farmer, an auto dealer is a middleman between the consumer and the manufacturer. However, few middlemen have seen their profits grow, or have as much unseen control over our choices as consumers, as the middleman between a patient and their pharmacist—the pharmacy benefit manager (PBM). The resulting financial and other costs of this trend could soon grow much higher if the Federal Trade Commission approves the proposed merger of PBM giants Express Scripts and Medco.

	When prescription drug plans became standard add-ons to health insurance plans, PBMs adjudicated the claims. They have since morphed into a multibillion dollar industry that is beholden to profit-hungry Wall Street investors rather than the employers hiring them, much less Main Street patients. While overseeing all aspects of the drug plan from setting retail level prices to deciding what drugs are covered, they also own huge mail-order services that compete directly with local pharmacies.

	PBMs market themselves as a method of reducing health plan costs on prescription benefits through negotiating strength with manufacturers and pharmacies. Supposedly, in turn, they pass along these savings to plan sponsors. However, with insurance premiums rising, increased co-payments, and PBM profits skyrocketing (while reimbursement to local pharmacies is declining), it’s fair to wonder who is truly benefiting from these supposed “savings.”

	Indeed, complex PBM contracts often “mark up” benefit claims to plan sponsors. Undisclosed rebates and other revenue from manufacturers are retained by the PBM rather than fully shared with patients and clients. Because most patients prefer using local pharmacies, PBMs have devised complex cost-shifting schemes that mandate that patients use only PBM-owned mail-order pharmacies and often raise costs to the health plan. To protect these huge profits, PBMs resist efforts that would force transparency and ensure that patients and health plans receive the full benefit from their prescription drug expenditures.

	Both houses of Congress have introduced legislation that would, among other provisions, crack down on this profiteering. The Pharmacy Competition and Consumer Act of 2011 (H.R. 1971/S.1058) is a bipartisan effort to institute pro-consumer reforms.

	Opponents to this legislation assert that, contrary to basic economics and history, transparency will increase costs and force disclosure of proprietary information. They are wrong on both counts. Transparency will bring true competition to the market by providing plan sponsors with the information necessary to ensure they are getting the best possible deal on their prescription plan, and it will force PBMs to lower their charges. Furthermore, the legislation greatly restricts what information must be disclosed and to whom, protecting market-sensitive data.

	Through the common sense reforms proposed by the Pharmacy Competition and Consumer Choice Act and by blocking the proposed Express Scripts/Medco merger, we can restore patient choice of pharmacy and lower costs to both consumers and plan sponsors. PT

Lonny Wilson, DPh, NCPA president and pharmacy owner Lonny Wilson, DPh, of Oklahoma City, Oklahama, the president of the National Community Pharmacists Association, has long been a fixture of Oklahoma health care and pharmacy circles. He is currently chief executive officer of the Pharmacy Providers of Oklahoma (PPOk). He has 30 years of experience in community pharmacy and currently owns and operates 3 pharmacies in eastern Oklahoma County—ValuMed Pharmacy of Fort Gibson, Midwest City, and Bestyet Discount Pharmacy of Harrah. Wilson also serves as chairman of Mirixa, a leading developer of innovative clinical solutions that facilitate pharmacist-based patient care services. Wilson is a graduate of Southwestern Oklahoma State University School of Pharmacy.

Articles

Pharmacy Benefit Managers: Middlemen Making Their Own Rules at Patient Expense

Ensuring patient access to community pharmacists is going to be an important part of health care reform. 

Lonny Wilson, DPh, NCPA president and pharmacy owner

	While the Affordable Care Act (ACA) was enacted principally to ensure health coverage for all Americans, it obviously has enormous implications for pharmacists as well. One linchpin in the law’s effort to provide affordable insurance options for the uninsured is its directive to states to establish health exchanges where consumers can purchase insurance. Billed by supporters as a “Travelocity” for health insurance, the exchanges don’t start until 2014, but critical decisions are being made today that will govern these patients’ interactions with pharmacists and their access to pharmacies.

	One example of this is what’s known as “essential health benefits” (EHBs). The law outlines 10 categories of health benefits that health plans included in these exchanges must cover. The National Community Pharmacists Association (NCPA) supported, and Congress ultimately included, prescription drugs and chronic disease management among the 10 categories of EHBs.

	Although prescription drugs and chronic disease management are treated as separate categories, both can be addressed by ensuring that patients have access to independent community pharmacies. Independent community pharmacists promote proper adherence to medication and face-to-face consultations with pharmacists, both integral components to properly manage chronic disease.

	But how do you define “access” under the ACA? That’s one of the issues that Congress left to the Department of Health and Human Services (HHS), which in turn has now indicated that EHBs will be defined by a “benchmark” health plan selected by each state. The selected benchmark plan will serve as a reference plan, reflecting both the scope of services and any limits offered by a “typical employer plan” as required by the ACA. In our view, the states in selecting their benchmark plan should not equate the ability of patients to obtain prescription medication solely through the mail as adequate “access” to pharmacy services. Although some patients may prefer mail order as an option, it should be the patient’s choice.

	There are a myriad of reasons why mailorder pharmacy is simply not appropriate for all patients or their medical conditions. Mail-order pharmacy is not appropriate for certain patient populations, such as many seniors, or for medications that are designed to treat acute conditions, or are temperature-sensitive. Furthermore, there are additional risks to patients that they could be delayed in receiving their mailorder medication, causing them to go without for a time. Once the prescription is processed, there are outside factors that could further delay delivery to patients, such as processing time at the mail center. The US Postal Service is actively seeking to implement changes that could slow parcel delivery, further muddying the outlook. Whatever the reason, patients not receiving their medication on time and in some cases receiving the wrong medication altogether face serious health risks and could ultimately need to seek out costlier options.

	Ensuring that patients have adequate access to the pharmacy of their choice, including independent community pharmacies, mitigates these risks. Community pharmacists will often advise if a generic alternative to a name brand prescription is available, where appropriate, and coordinate with the patient’s doctor. Generic utilization saves both the patient and their health plan significant sums, and community pharmacy has the highest rate of generic dispensing.

	Protecting the patient’s choice of pharmacy also dovetails with the ACA’s requirement on chronic disease management. The pharmacy practice is expanding to more pointedly address effective medication use and achieve optimal patient outcomes. In addition, community pharmacies represent the most accessible point in patient-centered health care, with 92% of Americans located within 5 miles of a retail pharmacy. Typically, consumers do not need an appointment to talk with a pharmacist in a community pharmacy about prescription medications, over-the-counter products, or any other health-related concern. The accessibility of the community pharmacist as well as the close tie that exists between many pharmacists and members of the community is critical, especially in rural or innercity areas where consumers may not have sufficient access to medical care.

	Finally, we believe that the benchmark health plan selected by each state should include pharmacist-provided medication therapy management (MTM) under chronic disease management. The New England Healthcare Institute has estimated that medication-related problems including poor adherence impose as much as $290 billion in largely avoidable annual costs—that’s 14% of health care expenditures. These costs include emergency department visits, hospitalizations, and other preventable forms of care. Face-to-face MTM can reduce these costs by preventing many of these adverse effects and ensure that more patients with chronic conditions remain adherent to their recommended drug regimens.

	We understand there are current legal challenges to the ACA that will be resolved in the coming months. However, at present, it remains the law of the land, and HHS and the states must take steps to ensure its smooth implementation. On behalf of our profession, NCPA will continue to urge the individual states to give serious consideration to the aforementioned recommendations when choosing their benchmark plan in order to ensure that patients have access to the best care available.

Lonny Wilson, DPh, of Oklahoma City, Oklahoma, the president of the National Community Pharmacists Association, has long been a fixture of Oklahoma health care and pharmacy circles. He is currently chief executive officer of the Pharmacy Providers of Oklahoma (PPOk). He has 30 years of experience in community pharmacy and currently owns and operates 3 pharmacies in eastern Oklahoma County—ValuMed Pharmacy of Fort Gibson, Midwest City, and Bestyet Discount Pharmacy of Harrah. Wilson also serves as chairman of Mirixa, a leading developer of innovative clinical solutions that facilitate pharmacist-based patient care services. Wilson is a graduate of Southwestern Oklahoma State University School of Pharmacy.