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Radar On Market Access: NASHP Unveils PBM Model Act

Posted by Matt Breese on Sep 20, 2018

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The National Academy for State Health Policy (NASHP) recently unveiled a model act aimed at helping states bring more transparency to PBMs, AIS Health reported.  
NASHP Executive Director Trish Riley says the academy's latest model legislation aimed at reining in prescription drug costs, which was developed in consultation with its pharmacy cost work group, is a compilation of states' recently enacted PBM laws. 
"Our strategy is just to get as many states engaged on this issue of pharmaceutical pricing as we can, and build a more standardized approach," she says.
Overall, according to NASHP, 80-plus PBM bills have been introduced in state legislatures this year alone, and 29 have become law amid states' growing concerns about PBMs' business model. The question is whether PBMs, which have largely opaque business practices, add value or simply contribute to rising drug costs, NASHP says.
Among numerous provisions, NASHP's model act calls for state licensure of PBMs. The model bill requires a PBM operating in a state to become licensed before conducting business in that state. Riley says eight of 29 PBM bills passed by the states this year require some state licensure or state accreditation for PBMs.
In addition, NASHP's model act requires PBMs to have a fiduciary responsibility to their health plan clients. It also includes a "gag clause" ban, which Riley says is found in 17 of the 29 PBM laws already enacted this year. 
NASHP's proposed legislation also prevents a plan or its PBM from setting patient copays or coinsurance at a higher level than the drug's actual cost to the plan or PBM, and it requires the PBM to notify plan clients if it has any conflicts of interest, such as owning pharmacy operations. The act also prohibits PBMs from penalizing patients who don't use pharmacy services in which the PBM has an ownership stake and requires a PBM to report rebates and fees in various ways, making information publicly available that isn’t a "trade secret."

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Topics: Specialty, Industry Trends, Market Access