State Takes On Pharmacy Benefit Managers

OLYPHANT, Pa. -- The Pennsylvania auditor general is taking on a part of the health care industry you may have never heard of, that takes billions of dollars from taxpayers every year.

They're called pharmacy benefit managers, and the state says they could be costing you more for your own prescriptions.

Pennsylvania Auditor General Eugene DePasquale was in Lackawanna County Wednesday calling for legislation to regulate pharmacy benefit managers. He says they are hurting small pharmacies and may be affecting how much patients pay for their prescriptions.

DePasquale visited Medicap Pharmacy in Olyphant to talk about pharmacy benefit managers. They've had a big impact on small pharmacies like Medicap, but owner Eric Pusey can't even tell you their names.

"I actually did receive a cease and desist order from one of the major companies because I said something they perceived as derogatory in the press. They said if I would continue to make any comments they would pull my contract," said Pusey.

Pusey says pharmacy benefit managers, or PBMs, actually don't allow him to tell customers about ways they could save money on prescriptions or over-the-counter medications.

In the past six months, PBMs have really started to affect Pusey's bottom line, taking more money from the sales of certain drugs.

"It forced us to take out multiple loans just to cover our costs, and stores are dropping left and right throughout the state."

That's why Auditor General DePasquale is calling for a change in state law. Some of the biggest PBMs include CVS Caremark, Express Scripts, and Optum RX, and DePasquale says they don't have any government oversight.

PBMs are also costing taxpayers more as Medicare and Medicaid costs grow.

"The idea that anyone, anyone, I don't care who you are, are able to spend billions of dollars in taxpayer dollars -- and when I say billions I mean billions -- and not have the public know how that money is being spent, that is an unacceptable situation," DePasquale said.

Auditor General DePasquale needs the state legislature to change the law to better regulate pharmacy benefit managers. He gave state lawmakers a list of suggestions on Wednesday, but it will have to first become a bill.