In late March, Wisconsin passed legislation to rein in practices of pharmacy benefit managers (PBMs), joining a growing number of states looking to understand what drives the confusion behind prescription drug prices. As a small community pharmacy, we have been squeezed as a result of PBM practices for a long time, and it continues to threaten our business, and our ability to treat patients.
When passing the legislation, Governor Tony Evers said it best, calling the PBM administration “a confusing and opaque system that often sends folks jumping through hoops just to access their life-saving medications.” This is true for patients and pharmacists. Acting as third-party administrators, PBMs manage the prescription drug benefits for large insurers, big employers, and government. Pharmacies must work with these entities because most patients rely on prescription drug benefits through insurance.
The relationship between PBMs and small pharmacies is not a two-way street, nor does it make our job caring for patients easy. Instead, these multi-billion-dollar corporations take advantage of their influence, creating mounds of red tape and additional expenses for pharmacies. At the same time, they make it harder for patients to access medications.
Many independent pharmacies, including ours, partner with pharmacy services administrative organizations (PSAOs) to help with PBM negotiations and the administrative headaches that come with these contracts. No matter how hard PSAOs advocate for our interests and community, PBM contracts remain one-sided, benefitting PBMs. As lawmakers nationwide increase scrutiny on their anti-competitive practices, PBMs have begun attacking trusted PSAOs and the services they provide to try and shield themselves from regulations. I hope lawmakers will reject their claims and recognize their misleading nature.
PSAOs help alleviate pharmacists’ administrative burdens so we can care for our patients. These entities manage claims, communicate with supply chain entities, and help with regulations and credentialing—all on behalf of small pharmacies. Despite PBM claims, PSAOs have no influence on prescription drug prices. PBMs do.
Lawmakers have made steps toward implementing the proper oversight of PBMs, reining in complicated billing and pricing structures. But we need more transparency. PBMs still control where patients have their medications covered, often driving consumers to their large pharmacy partners. As you can imagine, this does not just harm small pharmacies’ bottom lines, but it makes it less convenient for patients.
The pandemic has only underscored the importance of small pharmacies. Daily, we have proven our commitment to patient care and community health—no matter the risks or difficulties. More than ever, we are the most trusted and reliable health providers, and supporting our businesses is crucial to public health.
As lawmakers continue to seek more transparency and lower drug prices, I encourage them to work alongside community pharmacies to rein in PBMs.
Amy Donaldson and Gary Donaldson
Co-owners of Nicolet Pharmacy, Lakewood, Wis.