Attorney General Dave Yost seeks reforms to rein in PBM abuses

Marty Schladen | The Columbus Dispatch

Attorney General Dave Yost on Monday called for reforms intended to bring more transparency and better oversight of the drug middlemen who each year spend billions of taxpayer dollars on prescriptions for the poorest Ohioans.

The middlemen, known as pharmacy benefit managers, negotiate rebates from drug manufacturers and decide how much to pay pharmacies on behalf of managed care plans that work with the state. As a third party that contracts with a private company, the PBMs’ contracts aren’t hidden only from the public, they’re often also kept secret from the state officials responsible for programs such as Medicaid, the federal-state health-care program for the poor and disabled.

Investigations showed that the PBMs serving Ohio Medicaid — CVS Caremark and OptumRx — in 2017 charged $224 million more for drugs than they reimbursed pharmacies.

Despite digging into PBM practices, Yost said his office has not been able calculate profits, “so I can’t tell you whether we got a good deal.”

In a statement, Yost said PBMs are working deals behind the scenes to benefit themselves while calling on legislators to improve state laws and state administrators to pursue better rules and oversight.

“PBMs have taken advantage of the lack of transparency and lack of centralization to the detriment of Ohio taxpayers,” Yost said. “This must stop. Centralization will allow for the comprehensive review of prices across the entire drug purchase portfolio to eliminate this problem.”

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