Currently Viewing:
World Health Care Congress 2019
Unlocking Innovation in Value-Based Care
April 29, 2019
In First Speech Since Stepping Down as FDA Commissioner, Gottlieb Reflects on Agency's Push for Innovation
April 30, 2019
The Intersection of Technology and Care Management: Ensuring Optimal Aging at Home
April 30, 2019
Building the Evidence Base to Quantify, Communicate the ROI of SDOH Initiatives
April 30, 2019
Senator Cassidy Touts Alternative to Medicare for All, Outlines Other Healthcare Priorities
May 01, 2019
Dr Susan Mani on the Importance of Process Measures When Determining Value of SDOH Initiatives
May 07, 2019
Dr Martin Makary Discusses Hospitals Being Required to Post Prices of Services Online
May 09, 2019
Dr Susan Mani: How LifeBridge Health Came to Recognize the Importance of SDOH
May 17, 2019
Currently Reading
Dr Martin Makary on How PBMs Impact Drug Pricing, Transparency
May 20, 2019
Dr Susan Mani Outlines Barriers to Understanding the ROI of SDOH Initiatives
May 31, 2019
Dr Martin Makary Outlines Advantages, Disadvantages of Group Purchasing Organizations
June 02, 2019
Dr Jason Mitchell on Aligning Incentives Across the Entire Healthcare System
June 05, 2019
Dr Susan Mani: How to Ensure Scalability, Sustainability of SDOH Initiatives
June 11, 2019
Dr Jason Mitchell Discusses Which Payment Models Have the Most Potential
June 17, 2019
Dr Jason Mitchell: Think Beyond a Patient's Disease Process
June 30, 2019
Dr Jason Mitchell Details the Importance of Data in Value-Based Care
July 11, 2019
Dr Jason Mitchell Outlines the Role of Commercial Payers in Value-Based Care
July 20, 2019

Dr Martin Makary on How PBMs Impact Drug Pricing, Transparency

Pharmacy benefit managers (PBMs), have historically been a black box for those paying into them, partly because medications are confusing, explained Martin Makary, MD, MPH, a surgical oncologist and chief of the Johns Hopkins Islet Transplant Center.


Pharmacy benefit managers (PBMs), have historically been a black box for those paying into them, partly because medications are confusing, explained Martin Makary, MD, MPH, a surgical oncologist and chief of the Johns Hopkins Islet Transplant Center.

How are pharmacy benefit managers impacting drug pricing, as well as transparency, in the US?

PBMs, or pharmacy benefit managers, have been historically a black box for those paying into them, partly because medications are confusing. How do you understand the names of thousands of medications, the brands, the generics, the biosimilars, at different doses and different frequencies? How does a CEO [chief executive officer] of an auto dealership understand all of that? That’s part of the reason why it’s been such a black box.

And then, the spreads on the individual medications have been highly variable depending on the PBM, if it’s a more fair and honest pricing PBM or a PBM that sees the opportunity to price gauge in that black box of not understanding what these medications even are.

There’s a lot of other games. Moving everyone to mail order, which the government, in part, created that game when they suggested compliance was an important factor. Compliance is an important factor, but we’ve got patients now getting medications sent to their home they never wanted or needed. But, the mail order game has sent refill requests to our offices as physicians saying refill request for Joe Smith. We’ve just been traditionally signing these things without reading them because we assume the patient requested a refill. The patient didn’t request a refill sometimes, and we’re signing them anyway, but when they’re on mail order, the meds get sent and sold even though the patient didn’t need them. We’ve seen record numbers of medications that patients don’t need and don’t want shipped to their homes, bags of medications getting filled in primary care physicians when doctors take them off medications because the patients bring them in and the doctor says you don’t need to be on this.

There are a lot of money games in the PBM space. Our restoringmedicine.org movement has been trying to reward the good PBMs in the market. Yes, there are good PBMs in the market, but a lot of PBMs will respond to a request for fair pricing. If a business says we want an administrative fee per prescription of $2.50, we want a 100% pass through of rebates from pharma, they can often negotiate a good PBM contract with many different PBMs. The idea that PBMs are all evil or all good, I think is an oversimplified approach.

Employers have a tremendous opportunity to negotiate fair and honest terms around specialty drugs, the mail order games, the spreads, and the rebates, and those 4 issues are issues that I tackle in the book “The Price We Pay” to try and inform businesses about how they can get a better deal on their drugs.

 
Copyright AJMC 2006-2019 Clinical Care Targeted Communications Group, LLC. All Rights Reserved.
x
Welcome the the new and improved AJMC.com, the premier managed market network. Tell us about yourself so that we can serve you better.
Sign Up