Patients, pharmacists press for PBM reform; PBM trade group warns of higher costs

BOSTON — Patients, independent pharmacists and pharmacy associations told the Joint Committee on Financial Services that pharmacy benefit managers (PBMs) are imposing practices that drive patients’ costs up and push independent pharmacies toward closure.

Jody Quinn, a Plymouth resident who has lived with psoriasis and psoriatic arthritis for more than 20 years, described repeated PBM delays and denials: "PBM is a powerful middleman in the health care supply chain. They impact patients, providers, and local pharmacies." She urged support for H.1234 and other PBM reform bills that would require rebate pass-through, create a PBM duty of care, and ban spread pricing.

Independent pharmacy advocates and state pharmacy groups pressed the committee for measures they say are necessary to keep pharmacies open. Todd Brown, executive director of the Massachusetts Independent Pharmacists Association, and Dennis Lyons, representing the Massachusetts Independent Pharmacists Association (written comments by the association were submitted), supported House Bill 1157 and Senate Bill 831 to require fair reimbursement tied to a Medicaid-style payment formula, to ban spread pricing and retroactive clawbacks, and to require reasonable PBM audit policies.

"Community pharmacies are being underpaid, PBMs are being overpaid, and community pharmacies are closing," Brown testified, citing federal and state findings on margins and the loss of independent stores in Massachusetts.

Pharmacists and health-system pharmacy representatives described clinical impacts. Joanne Doyle Catrangelo, a pharmacist at Mass General Hospital and secretary for the Massachusetts Pharmacists Association, said one recent prior authorization required 15 phone calls and two weeks to resolve; the patient returned to the ICU while the paperwork was pending. Hospital and health-system pharmacists argued that safer care and improved medication adherence require local pharmacies and reasonable reimbursement.

Patient advocates and diabetes-care experts argued that reforms would improve adherence and outcomes. Paul Madden, a long-time diabetes educator and patient, urged passage of rebate pass-through bills and S.724/H.1234, noting that drug affordability affects hospitalizations and long-term complications.

PBM and health-plan representatives defended current arrangements. Sam Hallmeier, Senior Director of State Affairs at the Pharmaceutical Care Management Association (PCMA), told the committee that PBMs negotiate discounts and that plan sponsors have audit rights in contract language. He urged the committee to await the Health Policy Commission’s (HPC) ongoing review created by PACT Act reforms passed last year, saying several proposed bills could reduce cost-control tools available to plans and raise premiums and co-pays.

Health plans made similar arguments. Sarah Caramita of the Massachusetts Association of Health Plans said bills requiring any-willing specialty pharmacies or mandated rebate pass-through would increase costs for plan sponsors and members and could add hundreds of millions to state health spending.

The committee heard many patient stories recommending reforms that would require PBMs to pass rebates to patients at point of sale, ban spread pricing and clawbacks, establish a duty of care, and require transparent audit procedures. Providers and independent pharmacists urged fixing pharmacy reimbursement with a published, auditable formula.

No formal votes were taken. Committee members asked sponsors and stakeholders to provide additional data on audit outcomes, audit policies, and the projected fiscal impacts of the bills.

Ending: The testimony underscored broad agreement on patient harm and pharmacy closures, deep disagreement on root causes and remedies, and a legislative path that the committee will continue to explore.