Appropriations and Budget Health Subcommittee [Source]

The meeting focused on the challenges and dynamics surrounding drug costs, particularly the role of pharmacy benefit managers (PBMs) in the healthcare system. Jonathan Buxton from the Pharmaceutical Care Management Association (PCMA) provided an overview of PBMs, explaining their function as intermediaries between pharmaceutical manufacturers, pharmacies, and plan sponsors. He emphasized that PBMs negotiate rebates with manufacturers to lower drug prices and manage prescription drug insurance for various sponsors, including employers and government programs. Concerns were raised about the impact of PBM practices on community and retail pharmacies, especially regarding reimbursement rates and the viability of pharmacies in rural areas. Representatives questioned PBMs' responsibility to ensure adequate reimbursement for pharmacies, with Buxton acknowledging the challenges but asserting that PBMs aim to create competitive environments that benefit patients and plan sponsors. The discussion highlighted the financial dynamics between pharmacies and PBMs, noting that while PBMs claim to pass on savings, many independent pharmacies report low profit margins. A participant pointed out that PBM profit margins are significantly higher than those of independent pharmacies, raising concerns about the sustainability of the latter. The transition from co-pays to cost-sharing in insurance plans was also discussed, with representatives expressing frustration over high deductible plans that burden patients, particularly those with chronic conditions. The complexities of the pharmaceutical pricing system were further examined, with discussions on the rebate system's impact on uninsured individuals and the need for transparency in pricing. Antonio Chacha provided insights into conflicts of interest within the drug supply chain, highlighting issues like spread pricing in Medicaid managed care programs. The meeting also addressed the regulatory landscape, with discussions on the effectiveness of state laws regulating PBMs and the challenges posed by federal preemption. The need for audits of PBM practices was emphasized, particularly regarding reimbursement rates and the potential for fraud. Concerns about PBMs owning pharmacies and the implications for independent pharmacies were raised, along with the introduction of reverse auctions as a method for states to procure PBM services competitively. The conversation included the unique aspects of the workers' compensation sector, with calls for legislative clarity to distinguish it from the commercial health sector. The meeting concluded with a focus on the ongoing efforts of the Attorney General's office to enforce PBM regulations and ensure fair practices, including the recovery of funds for the state plan. The importance of collaboration among stakeholders and the need for continued dialogue on these issues were reiterated, with a commitment to address the challenges faced by independent pharmacies and improve healthcare access for Oklahomans.