From Sen. Zach Nunn’s newsletter:
With the sunny weather ahead of us, it’s also time Iowans see a bit of sunlight shed on how medicine prices are determined — and how much the middlemen are taking. This week, the Iowa Senate passed bipartisan legislation to help make that happen.
Below is a deeper look at what this Pharmacy Benefit Manager (PBM) legislation does, plus analysis on ending the blood tax in Iowa and how the CARE Act, championed by AARP and just signed by Gov. Reynolds, will help family caregivers across the state.
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1.) Increasing transparency in medicine costs and how much the middlemen are taking
The background: Pharmacy Benefit Managers (PBMs) started out as middlemen who could negotiate with drug companies for consumers and secure lower prices for consumers.
But, but, but… as drug prices continue to explode, there have been calls across the country for more transparency in the PBM system to make sure it’s still what’s best for consumers.
- Federal action: US Sen. Chuck Grassley announced he’d be probing this issue of PBM transparency in the US Senate Finance Committee
- State-level action: Zach Nunn and the Iowa Senate just passed bipartisan legislation to boost transparency in pricing schemes, administrative fees, and the aggregate amount of rebates retained by PBMs not passed on to health carriers.
- Reports show about 70% of prescriptions pass through a PBM today
- The lack of transparency in who’s getting paid (and how much) when it comes to medicine is a central problem in the healthcare system. If every entity involved in the healthcare process has a chance to shroud their fees and pricing behind unreadable codes and a lack of disclosures, the patient loses out
- When PBMs operate under an increasingly complex fee structures, our local independent pharmacies are also harmed