Advancing Free Market Healthcare sent a memo to Wisconsin legislators asking them not to support Senate Bill 203, otherwise known as the Pharmacy Benefit Manager (PBM) reform bill.
Unfortunately, the proposed bill includes several provisions that would be costly for employers and employees if enacted into law:
- Restrictions on Mail Order – The proposal would prohibit PBMs working with employers to align incentives to encourage employees to choose a more efficient delivery system that comes with significant savings to our health plans. This is likely to impact mail order medications that are internationally sourced if done through a PBM.
- Prohibiting Mid-Year Formulary Changes – There are less expensive biosimilars and generics coming to market all the time that are safe and effective for patients to use. But the bill would force an employer plan to wait until renewal to make a formulary change to drive patients to lower cost, safe biosimilars. This makes no fiscal sense for employers or employees.
- Prohibiting Copay Accumulator Programs – This stands out as perhaps the most anti-free market provision of the proposal, as it removes market forces that might otherwise encourage pharmaceutical companies to reduce their prices. The legislation would force health plans, including employers, to count the value of drug coupons toward deductibles and maximum-out-of-pockets.
- Minimum Dispensing Fees – The proposal would significantly increase dispensing fees, the cost of which will be passed along to employees, their families and insurance consumers.
Advancing Free Market Healthcare worked with National CooperativeRx, a co-op of employers that purchase PBM services together, to help estimate the cost of these provisions for the purposes of educating lawmakers. They estimate that these four provisions alone would cost their Wisconsin employers more than $20 million annually if SB 203 should pass.
Advancing Free Market Healthcare will be hosting meetings with lawmakers to help them understand the cost and market implications of making such changes. Please consider joining a regional meeting if we reach out to you.