Miami Herald Opinion Editorial by Michael Jackson, EVP/CEO of the Florida Pharmacy Association and EMPOWER Patients Coalition Member
For most people, it’s instinctual to condemn or even attempt to correct injustice when they witness it. Be it a bully harassing a smaller child on the playground or a thief stealing from a mom-and-pop shop with no remorse, when they see it — when they put a face with it — they can’t just sit back and do nothing.
We formed the EMPOWER Patients coalition because, in our own ways, we’ve all witnessed the injustice proliferated by powerful and predatory Pharmacy Benefit Managers (PBMs), and we can’t sit back and do nothing anymore. These faceless corporations tout their role as intermediaries between health insurers and prescription drug manufacturers, responsible for regulating prices within the supply chain, but if the general public were to look behind closed doors, like we have, they’d see mercenary executives lining their pockets with hard-earned taxpayer dollars, comfortably exploiting patients and putting community and independent pharmacies out of business — all without any regulation.
Enough is enough.
EMPOWER Patients is facing the faceless in Florida’s prescription drug market. And we’re grateful to have the support of State Rep. Jackie Toledo, a Tampa Republican, and State Sen. Ana Maria Rodriguez, a Doral Republican, who recently introduced House Bill 357 and Senate Bill 742 to establish transparency and accountability among PBMs, particularly the three that maintain 75% control and serve over 270 million Americans.
LARGE AND LUCRATIVE COMPANIES
It’s a serious problem for patients. For perspective, these companies are some of the largest, most lucrative in America — ranking within the Fortune 15 — and yet they’re deciding which prescription drugs to cover based on the size of the rebates they’ll receive from manufacturers, not the best interest of our family and friends who are suffering from cancer, diabetes and other debilitating or potentially life-threatening diseases. As if that wasn’t bad enough, they’re also raising out-of-pocket drug costs by almost 30%.
In fact, a recent independent report from Milliman, commissioned by the Florida Agency for Health Care Administration and developed using agency data, found that PBMs dealing in the state’s Medicaid program are profiting $89.6 million in taxpayer dollars annually through spread pricing alone.
This is a common — and we should add, unethical — practice where they charge insurers, or in this case, managed care plans, more than the pharmacy’s reimbursement amount and pocket the difference. And while we estimate it’s more like $113 million, it’s also allowing PBMs to bring in up to 109 times more revenue than the average independent or community pharmacy, forcing them to shut their doors.
The Milliman report also showed that CVS Caremark controls 41.1% of the PBM market share of Florida Medicaid, with their pharmacies filling 48% of all prescription drugs for recipients — but those same CVS retail pharmacies represent less than 20% of all independent or community pharmacies.
Given that these pharmacies are the ones that typically serve the underserved, it can be reasonably assumed that access to affordable medication in rural and inner-city neighborhoods is being restricted and local patients are being deprived of their freedom to choose. And what’s more, this scenario demonstrates that the current system is rigged against minorities and low-income families.
CONTROL OVER HEALTH DECISIONS
While certainly compelling, for EMPOWER Patients, Rep. Toledo, Sen. Rodriguez, and so many others, this report represents documented evidence of what we’ve already seen for ourselves. Without appropriate oversight, the opportunistic, anti-competitive practices of PBMs are expanding, giving them increasing control to make decisions about Floridians’ health, despite the fact that they don’t actually offer any healthcare services.
There’s no question that comprehensive reform should be a priority for the Florida Legislature in 2022, as it has been for 23 other states across the nation. We urge lawmakers to join the conversation, ask tough questions, promote accountability and transparency, and support House Bill 357 and Senate Bill 742.
Together, we can right the severe and pervasive wrongs committed by PBMs.
Michael Jackson is executive vice president and CEO of the Florida Pharmacy Association and a coalition member of EMPOWER Patients, comprised of neighborhood and independent pharmacists and pharmacies.