Drug prices have become a heated topic of political discussion, especially with President Donald Trump’s press conference held within the White House Rose Garden earlier this month. He directly confronted the issue of rising drug prices and declared, “The middlemen have become very rich… They won’t be so rich anymore.”
Many states are actively working on legislation to combat PBM clawbacks that are wreaking havoc on profits. Ohio has made great progress in PBM transparency and MAC (maximum allowable cost) pricing, and other states like West Virginia and Kentucky are targeting the pharmacy benefit managers operating in managed Medicaid. Among these states taking action, Arkansas was the first to pass legislation that regulates pharmacy benefit managers, which became a critical necessity at the start of 2018.
Celebrations of the new year were halted abruptly when Arkansas pharmacists were hit with a dramatic decline in reimbursements overnight. Scott Pace, CEO of Arkansas Pharmacists Association and owner of Kavanaugh Pharmacy, recounts that day: “Reimbursements went from a reasonable level to next to nothing overnight for no other reason than the PBMs and the insurance companies could do it.” Since 2003, the state of Arkansas has been in a battle with PBMs, a source of irony that Scott points out. “It was 15 years ago that the pharmacists’ association made its first attempt to license and oversee pharmacy benefit managers in Arkansas because we recognized the bad acts that were happening and knew that there needed to be some oversight.” With the sudden decrease of reimbursements, Arkansas pharmacists were spurred into immediate action, and on March 15, they witnessed Governor Asa Hutchinson sign the first comprehensive PBM licensure and oversight law. Although the process appears to have only taken three months, Arkansas pharmacists have spent years actively working towards this legislation. The crisis at the first of the year led the state to push forward this important legislation. Scott identifies some of the key factors behind the successful licensure of pharmacy benefit managers.
First, Scott recommends pharmacists unite under one common banner. Arkansas has one organization that represents all pharmacists in the state, which made a huge difference in organizing a coalition against PBMs. “What I saw in Arkansas is pharmacists in every practice setting locked arm-in-arm around this issue because they understood that the future of pharmacy as a whole was inextricably linked to whether or not pharmacists were going to be able to control the profession of pharmacy,” he explains. “We had health system pharmacists, consultant pharmacists, academic pharmacists, nuclear pharmacists, chain and independent pharmacists — you name it, they showed up, and together, we all made a difference.”
Show Up and Engage
Joining an organization is the first step, but actually showing up to represent pharmacy is critical, according to Scott. “I can’t say enough good things about our members in Arkansas,” he says. “If we asked them to do something, they did it, whether it was to call their legislator, put a sign on their counter, engage their patients, or do radio and TV interviews.” Engagement within an organized effort makes the “noise” that legislators and other colleagues need to hear in order to create change.
Find Unexpected Allies
Pharmacists aren’t the only ones who are contending for improved patient practices. The American Cancer Society, rheumatology associations, drug wholesalers, buying groups, and other stakeholders worked with the Arkansas Pharmacists Association to impede the pharmacy benefit managers that were taking advantage of all of them. “Healthcare is about doing good things for patients,” Scott affirms, “and that’s what we saw these groups come together to focus on.” The combined effort from all parties, combined with the bad acts of the PBMs at the first of the year, created urgency around the PBM issue that was noticed by lawmakers and the media, which helped accelerate the process.
Although Arkansas finally received the licensure within months after reimbursements suddenly decreased, Scott emphasizes that the journey was a long one, and results may not be as immediate for other states. “The very fact that we had such movement as quickly as we did in Arkansas should not be lost on the fact that it’s been a 15-year battle. This wasn’t our first time down this path, but it was the first time there was an acute crisis that demanded the path be pushed down, and ‘no’ could not be the answer.” Reimbursements showed signs of increasing before April 1, and Arkansas pharmacists like Scott are hopeful for a more fair playing field as state insurance commissioners work on the rules and regulations that will define the licensure process. “It’s always a process, and we’ll always keep working towards making things better,” Scott says.
Arkansas’s victory over the PBMs is proof that, with a united front, any state can rise to the occasion and conquer the so-called giants that interfere with community pharmacy and better patient care. Scott concludes, “Go search for that opportunity. Go create that opportunity. Go BE that opportunity! That’s how pharmacy gets redefined for the next generation.”