Community Pharmacists Respond to PCMA’s Amicus Brief on States' Authority to Regulate PBMs

NCPA March 25, 2020

ALEXANDRIA, Va. (March 25, 2020) - The National Community Pharmacists Association (NCPA), the Arkansas Pharmacists Association (APA), and the American Pharmacists Association (APhA) responded to the brief that the Pharmaceutical Care Management Association (PCMA) filed today with the Supreme Court in Rutledge v. PCMA, No. 18-540 (U.S.). In its brief, PCMA argues that the States cannot regulate pharmacy benefit managers (PBMs) for the 153 million Americans who receive healthcare coverage through their employer.

Nearly all States have sought to curb abusive PBM practices, which are harming patients and pharmacies, and needlessly increasing drug costs. According to PCMA, these laws are preempted by the federal Employee Retirement Income Security Act of 1974 (ERISA) anytime a PBM is providing services to an employer-sponsored prescription-drug benefit plan.

"The PBMs have been hiding behind the false argument that ERISA preempts the states from adopting reasonable regulation, said B. Douglas Hoey, NCPA CEO. "ERISA was never intended to be a force field around corporate middlemen hired by the plans. We are confident that the Supreme Court will agree."

The PBMs have argued for decades that they are exempt from state regulation by vague language in the Employer Retirement Income Security Act of 1974. The law precludes states from regulating employee benefit plans, but not third-party vendors hired by the plans.

"PBMs continue to insist on a regulatory vacuum that gives them complete freedom to exploit the healthcare system with no oversight at all," Arkansas Pharmacists Association CEO John Vinson said. "The country's current public health emergency shows how important frontline healthcare workers like pharmacists are to the health and safety of the American people, yet PBMs set their priorities on profits. PBM regulations provide an even playing field and consistent transparency that benefits all parties involved, especially patients."

"Patients are rapidly losing access to a readily available, knowledgeable health care provider as unregulated PBM practices starve pharmacies of fair and adequate reimbursement using unfair trade practices and leverage illegal in other areas of health care," said APhA Executive Vice President and CEO Thomas E. Menighan, BSPharm, MBA, ScD (Hon), FAPhA. "Regulating PBMs is vital to preserving the benefits that pharmacists are valued for — helping patients make the most of their medications, avoiding preventable illnesses, managing chronic diseases, and keeping them out of the hospital. Patients need access to their pharmacists. Without fair regulation the future of accessibility to pharmacists is in jeopardy."

The arguments in Rutledge v. PCMA are set to heard by the Supreme Court on April 27, 2020.

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National Community Pharmacists Association, visit Contact: Jack Mozloom, (703) 600-1177, or [email protected]

Arkansas Pharmacists Association, visit Contact: Jordan Foster, (501) 944-6450, or [email protected]

American Pharmacists Association, visit Contact: Chad Clinton, (202) 429-7558, or [email protected]