Maine’s prescription drug costs, industry middle-men targeted by Senator Matt Pouliot in new bill

Senator Matt Pouliot (R – Kennebec) is sponsoring a bill that targets prescription drug costs and puts some restrictions on pharmacy benefit managers. Some studies show those benefit managers do not always help control or reduce prescription drug prices.

AUGUSTA – Senator Matt Pouliot is taking the recommendations of the Legislature’s 2018 bipartisan task force on health coverage for all of Maine seriously.

On Tuesday, Sen. Pouliot introduced a bill that targets prescription drug costs by requiring pharmacy benefit managers to register with the state of Maine, imposes standards they must meet and follow to maintain their status, protects pharmacists from being penalized for instructing Mainers on lower cost options and tracks the practices of the pharmacy benefit managers to ensure compliance with the law.

“The goal of this legislation is to help address the high cost of prescription drugs and the impacts it has on many Maine families by implementing the recommendations of the bipartisan task force,” said Sen. Pouliot.

“Pharmacy benefit managers contract with health care plans to administer prescription drug benefits, and oftentimes, their practices benefit insurance companies with no savings passed on to consumers. I think it’s time for lawmakers to take a closer look at this practice so Maine families can better afford the medications they need to live full, healthy lives.”

The bill protects pharmacists from being penalized by pharmacy benefit managers if they discuss the costs of prescription drugs with a person who is filling a prescription, and it restricts pharmacy benefit managers from pushing individuals to use retail pharmacy locations in which they have a financial interest or partnership.

The bill also requires the financial rewards that pharmacy benefit managers collect be tracked and reported, those rewards include administrative fees and rebates.

Pharmacy benefit managers are outside entities that manage prescription drug coverage for health insurers and in theory should use the broad buying power of their network of clients to negotiate lower prices for prescription drugs. Even Medicare Part D insurers and Medicaid managed care plans utilize pharmacy benefit managers.

However some groups, such as the Medicare Payments Advisory Committee, an official Congressional advisory agency, are pointing out that PBM’s are not always lowering drug prices.

Under Medicare Part D, the incentive structure has caused some PBMs to profit from the structure of the programs by adding more high price, high rebate drugs to their formularies instead of lower cost drugs that cost the consumer less.

PBMs are not the only reason for higher prescription drug costs, but they do play a role. Up until 2017, prescription drug prices had been steadily rising and PBMs were doing little to control costs.

Over the past two years, prices have flattened out, but that may have more to do with market conditions and other actions than the work of PBMs.

The Peterson-Kaiser Health System Tracker attributes some of the growth in drug spending costs to new brands, fewer generic drugs available from expired patents and high prices for existing drugs.

Changes in some of those factors could also cause drug prices to flatten out or drop overall.

Representatives from the Maine Pharmacy Association and Maine Medical Association both testified in support of Sen. Pouliot’s bill.

L.D. 1389 “An Act To Address Transparency, Accountability and Oversight of Pharmacy Benefit Managers” has three cosponsors in addition to Senator Matt Pouliot:

Representative Mark Blier (R – Buxton)
Senator Robert Foley (R – York)
Representative Joshua Morris (R – Turner)

L.D. 1389 had a public hearing before the Maine Legislature’s Committee on Health Coverage, Insurance and Financial Services on Tuesday, April 16th. It will have a work session before being considered by the full Maine House and Senate.

You can read the actual text of Senator Pouliot’s bill by clicking here.

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