Pharmacists warn ArrayRx-style drug discount card could shift fees onto pharmacies; treasurer cites state savings and governance safeguards

The Ways & Means Committee turned to H.577, a bill to establish a Vermont prescription drug discount card program, and heard testimony from pharmacists and the state treasurer after the committee considered an amendment that removed a proposed special fund and explicit state fee-authority.

Jen Carvey of the Office of Legislative Counsel explained that the amendment keeps the program and the treasurer’s ability to cooperate with other states or consortia while striking language that would have authorized the treasurer to require participant fees or to create a stand-alone special fund. "This still creates the Vermont prescription drug discount card program," Carvey said, describing the markup and the decision to remove fee and special-fund language.

Local pharmacists and the Vermont Pharmacists Association expressed concern that the business model behind the discount card—presented as ArrayRx—passes administrative or participation fees back to pharmacies and can reduce reimbursement margins. Dr. Rangquin, a community pharmacist in Burlington, testified that "ArrayRx oftentimes winds up charging higher fees to pharmacies, expecting lower co-pays from the patient, which in turn has lower reimbursement rates for pharmacies." He said pharmacy profits on some prescriptions can fall to a few dollars or even pennies, putting small independent pharmacies at risk.

Dr. Lauren Bodie, legislative liaison for the Vermont Pharmacists Association, reviewed the available transaction data and told the committee "the idea that there's no money coming out of this from Vermonters does not appear to be correct," saying the program's economics show money flowing from patient and pharmacy to the discount-card operator in many transactions. Bodie recommended protections such as clearer accounting of fee flows and retailer protections if the state participates.

State Treasurer Mike Picek responded that the administration had worked with ArrayRx and the Green Mountain Care Board and that other participating states reported consumer savings. He said written assurances showed Vermont would not be charged a state fee for participation and that the proposed language allows the treasurer’s office to receive monies contributed to the cooperative to defray administrative costs. "Vermont would not be charged this fee regardless," Picek said, and he pointed to Connecticut and Oregon as states reporting resident-level savings.

Committee members asked for more operational detail: whether pharmacies could decline to participate, how the card interacts with existing PBM contracts (Navitus was specifically mentioned), how fees are set (by drug or by transaction), and whether the state can leave the arrangement if it created adverse local effects. Pharmacists told the committee the exercise of PBM contracts and employer-sponsored plans can make it difficult for a pharmacy to selectively refuse a discount card linked to a PBM they already accept.

The committee did not vote on H.577. Members agreed to make small language tweaks before moving forward and to consult JFO and appropriations staff about any fiscal impact. Witnesses and staff were asked to provide additional data on fee flows, the sample drug list behind the pricing examples, and the experience of independent pharmacies in states that have participated in the program.

What’s next: Committee staff will follow up with the treasurer’s office, ArrayRx partners, and pharmacist organizations to request more complete pricing and fee-flow data prior to a future vote.