Alarming pharmacy closures in Kansas illustrate need for urgent PBM reform
In an era where we are increasing scrutiny in the drug supply chain and identifying barriers to affordable prescription drugs, we find ourselves questioning the role that pharmacy benefit managers' (PBMs) claim to serve and how three PBMs have evolved to be among America’s most powerful corporations.
These intermediaries — operating between patients, pharmacies, manufacturers and insurers — wield unprecedented power over your medical needs. PBMs claim to have practices that produce savings for patients, but we’re finding that to be further and further from the truth. Government audits and investigations are finding that PBMs are exacerbating access to care through business tools like spread pricing.
Spread pricing — the practice of PBMs basically pocketing the difference between what they charge insurers and what they reimburse pharmacies — has largely been a black box. This opacity raises concerns about fair pricing, and it questions the motivations behind the drugs that are available to patients.
Without transparency, patients and health care providers alike are left in the dark about how drug prices are determined.
Across the country, states have opened the books to find how PBMs use this opaque tool for financial gain and have moved to require greater transparency and ban it altogether. Comprehensive PBM reform can level the playing field against this oligopoly and put patient welfare at the forefront, and we’re already seeing the legislative push for that through our Congressional representatives.
Sen. Roger Marshall is championing several bipartisan bills, including the Drug Price Transparency in Medicaid Act of 2023 (SB 1038).
In Kansas, the consequences of spread pricing have been particularly severe, contributing to the financial strain faced by many rural pharmacies. As a result, pharmacies are finding it increasingly challenging to maintain operations, stock vital medications and worse, stay open.
In rural areas, where the cost of living may be lower than urban counterparts, reimbursement rates often do not align with the actual costs of providing care. This misalignment can be particularly crippling. Without action, this disturbing trend will create provider deserts, as pharmacies are the primary source of health care services in certain areas.
To protect patient interests, spread pricing must be banned to foster a more equitable and accessible pharmaceutical landscape.
PBM reform is not merely an option — it’s an imperative to safeguard patient access to care in rural areas of the state. By banning spread pricing, setting rate floors for drug reimbursements, and implementing targeted policies to support pharmacies in underserved regions, we can bridge the health care gap and ensure that every Kansan, regardless of location, has access to the medications they need.
We are encouraged by Sen. Marshall’s involvement in this conversation thus far and urge him to continue expanding his support for this crucial issue.
Together, we can build a healthier, more equitable future for all.
Steve Dreher is the division president of Dillons.
This article originally appeared on Topeka Capital-Journal: Alarming pharmacy closures in Kansas show need for urgent PBM reform
