NCPA Urges WV PBM Reform Rules to include Fair Reimbursement, Full Enforcement

NCPA July 8, 2021

ALEXANDRIA, Va. (July 8, 2021) —The National Community Pharmacists Association urged the West Virginia Offices of the Insurance Commissioner to watch out for pharmacy benefit manager games when developing rules to implement reform legislation approved by Gov. Jim Justice (R) on April 9, 2021. Among other things, HB 2263 will implement reporting requirements to ensure transparency; prevent PBMs from charging higher copayments when patients go to a pharmacy of their choice; and ensure minimum reimbursement rates in line with rates a PBM pays to mail order pharmacies and other pharmacies owned by or affiliated with a PBM.

Studies in states across the country have revealed that PBMs are overcharging taxpayers for their services, reimbursing pharmacies low for medications dispensed, billing the state Medicaid program high for the cost of those medications, and retaining the difference, called “spread.” Additionally there have been issues with PBMs reimbursing pharmacies below acquisition cost, steering patients to pharmacies owned by or affiliated with PBMs, and other anticompetitive behaviors.

Also pursuing legislative solutions to further prevent PBM overreach, West Virginia started directly managing its Medicaid managed care prescription drug benefit in July 2017. The outcome was that West Virginia saved $54 million in the first year after the state took over management of the Medicaid pharmacy benefit.

In its comments, NCPA is urging the state to specify that pharmacy reimbursement should be inclusive of all fees, clawbacks, etc. that a PBM charges a pharmacy and that net reimbursement cannot be lower than the acquisition cost and required dispensing fee. NCPA is also pushing for language giving more flexibility to enforce the law’s provisions against ERISA plans to the full extent allowed by federal law and federal decisions such as Rutledge v. Pharmaceutical Care Management Association, in which the Supreme Court unanimously ruled that Arkansas PBM regulations were not preempted by the federal ERISA law. Accordingly, NCPA says, West Virginia and other states must monitor current and future court decisions, including the upcoming PCMA v. Wehbi in the Eighth Circuit, to ensure they protect citizens from PBM abuses to their fullest authority.

“Time and time again we see PBMs manipulate the health care system to evade scrutiny, skirt reforms or maximize profits, so laws and regulations to rein them in need to be as thorough as possible,” said Karry La Violette, NCPA Senior Vice President of Government Affairs. “States like West Virginia are seeing through PBM games and passing reform legislation like HB 2263. Their patients, small business independent pharmacies, and budgets deserve these policies to be robust and fully enforced.”

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Founded in 1898, the National Community Pharmacists Association is the voice for the community pharmacist, representing over 21,000 pharmacies that employ approximately 250,000 individuals nationwide. Community pharmacies are rooted in the communities where they are located and are among America’s most accessible health care providers. To learn more, visit www.ncpa.org.

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