Empower Wisconsin | Jan. 31, 2020
By M.D. Kittle
MADISON — The chairman of the Assembly Health Committee tells Empower Wisconsin there will be a hearing next week — “come hell or high water” — on a bill aimed at bringing transparency to Pharmacy Benefit Managers’ (PBMs) practices.
State Rep. Joe Sanfelippo said the hearing is tentatively scheduled for 11 a.m. Wednesday at the Capitol. He expects a substitute bill encompassing key changes to Assembly Bill 114 and its Senate companion to be hammered out by then. Ultimately, the New Berlin Republican said, lawmakers want a bill that provides prescription drug pricing transparency and more accountability.
PBMs are third-party administrators of prescription drug coverage for insurers and employers. Pharmacy Benefit Managers earn a fee for the services they provide, including developing and maintaining prescription drug lists (formularies), processing claims and negotiating discounts and rebates.
Lobbyists for the prescription drug middlemen and others have been “slow-walking” the process, hoping legislation dies before the clock runs out on an election year-abbreviated session, multiple legislative sources tell Empower Wisconsin. But Assembly Speaker Robin Vos (R-Rochester) “has been working his tail off” to make sure a PBM bill makes it to the floor, Sanfelippo said.
“They (PBMs) think it’s going to go away, but it’s not,” the legislator said. “In our meetings, I told them (PBM lobbyists) that they make the mafia look like Boy Scouts with all their secrecy and silence. They operate in the dark and they want it to stay that way.”
Sanfelippo said lawmakers met with industry representatives for 2 1/2 hours last Wednesday afternoon. They had to take a break for Gov. Tony Evers’ State of the State address but returned to negotiations at 10 p.m. in the Speaker’s office.
State Rep. Michael Schraa (R-Oshkosh), who has worked with Sen. John Erpenbach (D-West Point) on the legislation, declined to comment until the final product is brought to next week’s hearing.
Sanfelippo praised Schraa for his hard work, saying lawmakers have had to “walk a tightrope” between delivering pricing transparency and making sure any changes won’t raise costs.
Representatives from the Pharmaceutical Care Management Association, which represents the nation’s PBMs, have not returned Empower Wisconsin’s request for comment, but their allies have warned that meddling with the current system could cost consumers.
The bill’s supporters say the reforms will finally hold the powerful PBMs accountable and stop the kind of “gag orders” that have blocked information that could save patients time, money, and wellness. Smaller, independent pharmacies claim PBMs are killing competition and pounding pharmacies with costly demands — from mandatory 90-day supplies with lower reimbursement formulas and forced mail orders to forced use of PBM-owned pharmacies.
“PBMs are determining winners and losers. They are doing it cloaked in secrecy, while costing health care billions of dollars,” Byron Berry, owner of a seven-store chain of pharmacies in Illinois told trade publication Elements magazine last year.
Sanfellipo said it’s time to move the bill forward. He said he doesn’t want to see a repeat of what happened with his bill on direct primary care, legislation that also would expand pricing transparency to the marketplace.
“Come hell or high water, we’re having this hearing,” he said.