The Georgia General Assembly has voted in favor of four bills that target the pharmacy benefit management system.
The Senate voted unanimously Thursday in favor of Senate Bill 313, which would revise the regulation and licensure of pharmacy benefit managers. It’s an effort for transparency in prescription drug prices echoed in three other bills passed by the House this week.
Pharmacy benefit managers (PBMs) are subcontractors that often dictate how much a pharmacy can charge a customer for prescription medications. Health insurance companies and Medicaid pay PBMs to negotiate prices with drug manufacturers on their behalf and maintain medication lists.
Drug manufacturers set the list price, which is the real cost of the drug without health-care coverage. However, PBMs often obtain rebates or discounts on the list price.
“On the whole, this bill is going to make some great strides in making sure that we do have greater transparency,” said the Senate bill’s sponsor, Sen. Dean Burke, R–Bainbridge. “So we can find out why is the cost of drugs is going up. What are the effects of rebates? What are the effects of spread pricing, so that we can make the best decision possible.”
If Burke’s bill becomes law, PBMs would be able to charge a health plan for only the actual cost of the drugs.
SB 313 also would require PBMs to report all rebates to health insurance companies, pass 100 percent of the rebates on to health plans, apply discounts to the co-pay for patients and follow national benchmarks for prices. The bill also requires licenses for PBMs to operate in the state and limits delays caused by prior authorization requests.
SB 313 now heads to the House for review.
The majority of the House approved two similar bills Wednesday.
The House voted, 165-1, in favor of House Bill 946, which would add penalties for PBMs who violate the Department of Insurance’s regulations and require them to offer generic or cheaper options of drugs.
The House unanimously approved a review of the cost of the PBM process for the Medicaid program.
The bill’s sponsors want the Georgia Department of Community Health to conduct a study to see how much it would cost the department to crave out PBMs from the prescription drug transactions.
House Bill 918, which was unanimously passed the House on Wednesday, would act as a barrier between pharmacies and PBMs. It gives pharmacies more leeway in the amount of time before and after audits, limits the number of prescriptions that can be audited and lowers penalties for errors.
Rep. Sharon Cooper, R-Marietta, said PBMs tend to choose the more expensive drugs for the audits to earn bigger payouts.
All three House bills now head to the Senate for review.
The rising cost of medicine and industry control by PBMs have been an ongoing issue during the past decade.
A Consumer Reports survey found 30 percent of American adults say their out-of-pocket cost for their recurring prescriptions has increased in the past year.
