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House of Representatives
Session of 2019 - 2020 Regular Session


Posted: April 3, 2019 12:14 PM
From: Representative Doyle Heffley and Rep. Robert F. Matzie
To: All House members
Subject: PBM Pricing Transparency in Medicaid - Heffley/Matzie

In the near future, we will be introducing legislation to increase transparency in pharmacy benefit manager (PBM) pricing practices in our Medicaid program.

Almost 90 percent of Pennsylvania Medicaid patients are served by managed-care companies that contract with the state. In turn, those companies contract with PBMs for their pharmacy programs to decide which drugs will be covered and how much to reimburse the pharmacies that fill the prescriptions.

Over the last two years, we both continue to hear from our local pharmacies about severe cuts to pharmacy reimbursement rates by PBMs, especially in Medicaid. For many medications, payments are well below cost, forcing pharmacies to operate in the red. These pharmacy reimbursement cuts make it extremely difficult for the 900 independent pharmacies in our Commonwealth to maintain inventory, stay in business and serve our most vulnerable citizens.

We share the pharmacists' frustration regarding this issue. Therefore, we are planning to introduce legislation requiring transparency in PBM pricing practices in Medicaid and addressing inadequate reimbursement rates for pharmacies.

If reimbursement rates continue to diminish and pharmacies continue to operate substantially below cost, they will have to close their doors and patients will suffer. We hope you will join us in cosponsoring this important legislation.

Introduced as HB941