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Today the PBM Licensure and Regulation, SF278, Conference Report was passed by the Minnesota State Senate (Unanimous) and House (130-2). Minnesota took a historic step today to license and regulate pharmacy benefit managers (PBMs), the pharmaceutical drug pricing and payment middleman, for the first time. Minnesota is home to Optum Rx, Prime Therapeutics and has a significant PBM employee footprint in Minnesota, including Express Scripts, CVS/Caremark and others.?The companies negotiate with drug manufacturers on behalf of government health plans and private and employer-based insurance plans. The deals they strike determine the availability and prices of prescription drugs for more than 266 million Americans. They determine what drugs are covered in their formularies, negotiate prices for these drugs with their manufacturers, set copays for consumers, determine which pharmacies will be included in prescription plans, and decide how much pharmacies will be reimbursed for the drugs they sell. ?The Minnesota PBM legislation was sought by patient advocates, doctors, community pharmacists as well as the self funded health care plans that provide pharmacy benefits to almost 60% of employees in Minnesota. The legislation, for the first time, will set up a licensing and regulatory framework, that will require PBMs to submit claims level information to health care plan sponsors and provide this information to the Department of Commerce, the State's insurance regulator. It will expose pricing schemes such as rebates, claw-backs, spread pricing and other variables that all go into setting a medication's price. These types of reforms will especially help patients with chronic diseases, such as diabetes patients who rely on insulin, who are often not benefiting from significant rebates and discounts. A bipartisan super majority of Republican and DFL legislators believe that price transparency in the prescription drug market will help lower drug prices and shed light on the perverse market incentives that are driving a drastic rise in prescription medication costs. ?The legislation will also will prohibit a PBM from "gagging"?pharmacists from providing lowest cost medication pricing information to their patients and would also mandate that the PBM provide the lowest price of a medication, in or out of network, to the patient at the point of sale. It would require PBMs give patients the ability to synchronize their prescription drug refills, which is currently prohibited in many PBM contracts. PBMs could not steer or require patients to fill their prescriptions at a PBM owned specialty drug or mail-order pharmacies under the legislation. Patient advocate organizations such as the MN-AARP, the MN chapter of the American Academy of Family Physicians, the MN Pharmacy Alliance, the MN-Health Action Group all supported PBM reforms and, after addressing their concerns, the MN Chamber of Commerce did not oppose the regulatory legislation.?The adopted Conference Report, SF278, passed on both the House and Senate floor today will presumably to be signed by Governor Walz when it reaches his desk in the next day or so. Governor Walz and the legislature are set on doing something about the high cost of prescription drug medications, helping insure patient access to pharmacists, providers and addressing other unfair and perverse pharmacy benefit practices. The Patient's Fair Practices legislation, SF278, is a giant first step to achieving those goals. ................
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