Blasts GAO's PBM Findings

Chain Pharmacy - National Association of  Chain Drug Stores Attacks
General Accounting Office Study of Pharmacy Benefit Managers and Their Role in Health Care Marketplace

Drug Store News,  Feb 17, 2003
by James Frederick

ALEXANDRIA, Va. -- The National Association of Chain Drug Stores is crying foul over a recently released General Accounting Office study of pharmacy benefit managers and the role they play in the health care marketplace.

The study, NACDS noted, "paints a skewed, inaccurate picture of PBMs' ability to reduce prescription drug costs and deliver quality care." A report on the study, dubbed "Federal Employees' Health Benefits: Effects of Using Pharmacy Benefit Managers on Health Plans, Enrollees and Pharmacies," concluded that PBMs are critical to managing drug benefits. As such, it is to play a significant role in the debate over Medicare reform and pharmacy benefits for uninsured seniors.

NACDS quickly attacked the government's findings. In a statement, the organization called the GAO's conclusions "baffling ... when PBMs contracted by the [Federal Employees' Health Benefit] plans refused to disclose the amount of drug manufacturer rebate dollars they keep and do not pass back to the FEHBP plans and their enrollees."

NACDS president and chief executive officer Craig Fuller also weighed in. "The GAO report ignores the reality that many public and private plans have been moving away from using PBMs because of the lack of transparency in their business operations," Fuller noted. "What's missing here are the facts, and I am afraid that the GAO pulled the proverbial wool over its own eyes by not taking a hard look at the schemes PBMs employ to benefit their financial interests."

Among the report's "glaring omissions," noted NACDS, was any reference to recent lawsuits by the federal government and some states to force PBMs to give back rebate dollars obtained from drug manufacturers. In addition, said the organization, "Had the GAO done a rigorous probing of the PBM marketplace, it would have found what many other payers have--that PBMs promote the use of higher-priced brand-name drugs."

PBMs also "stymie competition by steering enrollees to use their mail-order pharmacies from which the PBMs earn even greater revenue," NACDS charged. "GAO produced a biased report favorable to PBMs and lacking in facts."

Indeed, noted the pharmacy group, "with Congress poised to consider cost-effective ways to deliver a meaningful prescription drug benefit to seniors, GAO has done a disservice to policy makers by producing such a misleading study of PBMs." NACDS reported it was urging lawmakers to investigate the PBM industry "before providing them with a greater opportunity to reap windfall profits from senior citizens by managing a Medicare prescription drug benefit."


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