Bill would regulate pharmacy benefit managers

SANDUSKY — A Norwalk state representative said her new bill to regulate pharmacy benefit managers will provide needed oversight to an industry group that largely controls prescription drug prices. State Rep. Kellie Deeter, R-Norwalk, emphasized that her bill, House Bill 229, would allow the Ohio Department of Insurance to regulate pharmacy benefit managers, third-party administrators that handle pharmacy benefit plans, serving as middlemen between pharmacies and drug companies, wholesalers and health insurance companies. Presently, according to Deeter: • Three pharmacy benefit managers process approximately 80% of all pharmacy claims • Six pharmacy benefit managers control over 90% of the market, "This monopolistic behavior has had serious consequences. It has led to narrower provider networks, forced pharmacy closures and reduced patient access to care. Compounding the problem is a persistent lack of transparency in how pharmacy benefits are managed and reported," Deeter said in sponsor testimony on May 13 before the Ohio House General Government Committee, where her bill has been assigned. Deeter explained that while the insurance department can regulate third-party administrators, her bill would create a separate section in state law dealing with pharmacy benefit managers. The measure would allow the insurance department to license pharmacy benefit managers and to obtain information about pricing. A summary of the bill, prepared by staff for the Ohio General Assembly, explains that insurance officials would be able to obtain information about pricing discounts, rebates, fees and other facts that affect drug prices. The department would be able to look at terms and conditions for any contract between pharmacies and other parties. Deeter's sponsor testimony took place during the bill's first hearing on May 13. Three hearings are required when a bill is in committee, so it doesn't appear the panel will vote immediately on Deeter's bill. That vote could come anywhere from a couple of weeks from now to the next few months.