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PA Auditor General Issues Blistering Report on PBMs

Pennsylvania Auditor General Eugene DePasquale has released a report highly critical of pharmacy benefit managers and called for greater oversight of such companies.

Citing PBMs’ lack of transparency, lack of oversight, and reimbursement disparity, DePasquale’s report, compiled after research and public hearings throughout the state that relied heavily on the testimony of independent pharmacies, includes 10 recommendations, among them several that directly address Medicaid in Pennsylvania.  Those Medicaid-related recommendations are:

  • To better control costs, Pennsylvania should consider directly managing its Medicaid prescription drug benefits instead of contracting with managed care organizations to do so.
  • The General Assembly should pass legislation to use the federal Centers for Medicare & Medicaid Services’ National Average drug Acquisition Cost (NADAC) for pricing prescription drugs filled through Medicaid.
  • The General Assembly should grant state oversight of contracts signed between PBMs and pharmacies or pharmacy services administration organization, which are currently shielded from oversight because they are subcontracts.
  • Pennsylvania’s Department of Human Services should use Texas’ Vendor Drug Program as a model to create Pennsylvania’s own universal preferred drug list for Medicaid clients.
  • Pennsylvania’s Department of Human Services should add “good steward” language to all Medicaid-related contracts.

Learn more about the report issued by the Auditor General in this news release or go here to see the report “Bringing Transparency and Accountability to Drug Pricing.”

Filed in Pennsylvania Medicaid, Pennsylvania Medicaid policy.

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2012 Safety-Net Association of Pennsylvania