Erie pharmacies want level playing field on prescriptions. New Pa. law helps provide it

Rich Kosobucki has worked as a pharmacist for 53 years and has owned Erie's Medicap Pharmacy, 1896 E. Lake Road, for more than two decades.

In recent years, he has witnessed independent pharmacies much larger than his have to sell their business to chain pharmacies due to what he calls an unlevel playing field.

"It's really difficult to compete as an independent right now, with these (pharmacy benefit managers) steering patients to certain chain pharmacies," Kosobucki said. "They can't come to me to fill their prescriptions unless they pay the full cost of the drug."

Pharmacy benefit managers are third-party companies that act as middlemen between drug manufacturers and health insurers. They create drug formularies, negotiate rebates with drug makers, create pharmacy networks and manage mail-order pharmacies.

Created in the 1970s to help contain prescription drug costs, these PBMs (some of which are owned by drug makers) have an outsized say in the process, said state Rep. Jessica Benham, D-Allegheny County.

"Three of these PBMs — CVS Caremark, Express Scripts and Optum Rx — control more than 80% of the prescription drug market," Benham said Monday during a visit to Medicap Pharmacy. "If a patient has drug coverage through CVS Caremark, they have to either go to a CVS Pharmacy or use CVS mail order."

Patients in Pennsylvania won't have that restriction after Gov. Josh Shapiro last week signed into law Act 77, a bill cosponsored by Benham.

The new law bans patient steering by PBMs starting with their next provider contract. It also limits or bans retroactive recoupment of money paid to the pharmacy, and forcing prescriptions to be ordered by mail.

It also forces PBMs to file transparency reports with the Pennsylvania Insurance Department.

"It also requires a study of spread pricing, which is when the PBM overcharges the health insurer and undercharges the pharmacy, and pockets the difference," Benham said. "I tried to ban it with this bill but it was changed in the state Senate."

Erie pharmacist also wants penalty fees eliminated or changed

Kosobucki is pleased with the bill, which is why he invited Benham and state Rep. Pat Hawkins, D-Erie, to his pharmacy for a news conference.

But he wishes the bill also could have addressed direct and indirect remuneration fees. This is money PBMs take back from pharmacies, supposedly if they fail to meet quality measures — such as not filling prescriptions on time.

"But I'm paying back money even if I meet their goals 100%," Kosobucki said. "I had to pay back $60,000 last year, $60,000 the year before and $48,000 the year before that."

Any changes in DIR fees must be made at the federal level, Benham said.

"This new law is just the start," Benham said. "More changes hopefully will be coming, both on the state and federal levels."

Contact David Bruce at dbruce@timesnews.com . Follow him on X @ETNBruce .

This article originally appeared on Erie Times-News: Erie pharmacies want level playing field on prescriptions. New Pa. law helps provide it