Pharmacy benefit manager reform bill could lower prescription drug costs

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UPDATE (WKOW) 5:24 p.m. — Lowering prescription costs is the focus of one of the first bipartisan bills of the legislative session at the capitol. The proposal also focuses on boosting access to pharmacies.  

The measure would reform the “middle man” who calculates how much you pay for medication which is called a pharmacy benefit manager, or PBM. They play a big role in distributing and selling prescription drugs. Their job is to negotiate drug prices with insurers and employers. However, the price information they receive, pharmacists say is often times hidden from you.

“We need to be confident that PBM’s are not abusing their positions in the market as middle men and are acting in the best interests for their clients and patients,” said State Rep. Debra Kolste (D-Janesville).

Current law allows PBM’s to negotiate contracts, discounts, and rebates with drug manufacturers. Under the proposal, PBMs would be allowed to establish price requirements with their patients and allow consumers to get their prescription where they choose. It also removes a PBM’s ability to charge patients a higher co-pay than the price of their medication.

“Some pharmacy benefit managers have policies or business practices in place that cause a patient to pay for a co-payment that more expensive than it would have been without prescription insurance in the first place,” said Nick Olsen, Chairman of the Pharmacy Society of Wisconsin.

A similar bill was introduced in 2017 but never made it out of committee. Some who opposed it include Wisconsin Manufacturers and Commerce and the pharmacy CVS.

Both Republicans and Democrats hope this year will be different.

“Come together to agree on common sense reforms and have an immediate impact, immediate impact on the cost of prescription drugs,” said Senate President Roger Roth.

Other bill sponsors include State Rep. Michael Schraa (R–Oshkosh), and Rep. Debra Kolste (D– Janesville).

Kolste said she discussed the legislation with Gov. Tony Evers and said he’s aware of the bill.

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MADISON (WKOW) — One of the first bipartisan bills introduced this session would reform pharmacy benefit managers, known as PBMs, in how they negotiate contracts, discounts and rebates with drug manufacturers.

Under the proposal, PBMs would be allowed to establish price requirements with their patients and allow consumers to get their prescription where they choose.

“Many have established relationships with their pharmacist, and want to be able to get their life-saving medications from someone they trust,” said bill co-sponsor Senator Jon Erpenbach (D-Middleton). “Mail order pharmacies are a great option for many, but those who choose local pharmacies shouldn’t be punished with higher costs because of it.”

Senate President Roger Roth is also a co-sponsor of the bill and said the measure would reduce prescription drug costs.

“With our bill, we prohibit gag clauses, a measure PBMs put in place preventing pharmacists from giving lower-cost options to patients, and co-pay clawbacks to ensure Wisconsinites are not overpaying for the actual cost of the drug,” said Roth.

PBMs are primarily responsible for contracting with pharmacies and negotiating discounts and rebates with drug manufacturers.

Other bill sponsors include State Rep. Michael Schraa (R–Oshkosh), and Rep. Debra Kolste (D– Janesville).

Kolste said she discussed the legislation with Gov. Tony Evers and said he’s aware of the bill.

Emilee Fannon

Emilee Fannon

Capital Bureau Chief

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