As White House prepares ‘listening session’ on PBMs, here’s what they need to hear

On Monday, March 4, the White House will host a “listening session” on the impact of Pharmacy Benefit Managers (PBMs). This is a welcome effort to gather more information and perspective on what patients and families are facing, and there’s no doubt that the stories that will be shared will be illuminating.

In the spirit of “listening,” here are five realities that we hope come through loud and clear on Monday:

1. Patients must come first.

PBM business practices should first be understood in terms of the patient experience. PBMs restrict access or divert funds that could otherwise alleviate the burden for patients at the pharmacy counter. Special attention should be paid to stories that underscore those impacts.

2. Transparency is only the first step.

Much of the regulation that has been proposed to “reform” PBMs has focused on transparency: making sure that the government and other stakeholders have insight into the opaque business practices of PBMs.

But it’s critical that transparency be seen as only the foundational piece of a more comprehensive plan. PBMs have proven that they can use complexity and complacency as a shield against transparency. Reform must start, not end, with transparency.

3. PBM reform means rebate reform.

Rebates, in themselves, are not a bad thing. If they’re used in a way that puts patients first, enabling access and removing out-of-pocket costs, they should be celebrated.

But too often, PBMs pocket rebates and fees, playing shell games with money that ought to be directed to patients.

4. Employers have a role to play.

There’s no question that more stringent regulation of PBMs is needed to protect patients, but policymakers can’t assume that government regulation is the only tool to force PBMs to put patients first. The employers and health plans that contract with PBMs can also shape PBM behavior (as listening session attendee Mark Cuban is fond of noting), and the White House and others have a role to play in building awareness and giving employers the tools to demand greater control about how their dollars are spent.

5. Keep an eye on the Inflation Reduction Act (IRA).

The IRA will harm innovation, that much is clear. But it’s also possible that it will harm patient access, too. Under the law, PBMs will continue to be incentivized to favor high list/high rebate products. And more generally, with all the changes in the IRA, and plans/PBMs absorbing more of the responsibility in catastrophic, we worry patient access will suffer.

The bottom line on PBMs

The PBM industry evolves so quickly – always in the direction of ever-greater profits for the giant health insurers that own them – that half-measures won’t cut it.

Listening is an important first step, but only if it’s matched with strong action designed to attack the root of the problem, not just the symptoms.

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