WASHINGTON – The bipartisan PBM Transparency Act would save taxpayers $740 million over 10 years, according to a preliminary estimate by the nonpartisan Congressional Budget Office. The savings report comes as the Senate Commerce, Science and Transportation Committee prepares to consider the legislation later this week. The bill, which enjoys broad support from a diverse group of stakeholders, is sponsored by Senate Commerce, Science and Transportation Committee Chair Maria Cantwell (D-Wash.) and co-led by Sen. Chuck Grassley (R-Iowa).
“This bipartisan bill would not only put a stop to deceptive and opaque pricing schemes that burden consumers with higher prices, it also saves taxpayers $740 million. It’s a win-win, and warrants swift approval in Congress,” Grassley said.
The bill directs the FTC to end well-known and documented PBM practices that drive up consumer costs, namely: spread pricing and clawbacks. It also requires PBM transparency reporting to the FTC. The bill has strong guardrails to ensure the FTC works within its existing authority and the bill does not permit the FTC to write regulations.
Statements of support from a broad array of stakeholders follow:
“AIDS Healthcare Foundation (AHS) supports [Senators Cantwell and Grassley] legislative efforts to reign in pharmacy benefit manager (PBM) practices that harm patients.”
American Academy of Dermatology Association
“The Academy is pleased to offer its support for S. 127, the Pharmacy Benefit Manager Transparency Act, which is intended to increase drug pricing transparency and hold pharmacy benefit managers (PBMs) accountable for practices that drive up prescription drug costs.”
“On behalf of the physician and medical student members of the American Medical Association (AMA), I am writing in support of the S. 127, the “Pharmacy Benefit Manager Transparency Act of 2023.”
American Pharmacists Association
“The American Pharmacists Association (APhA) writes to offer our support for the Pharmacy Benefit Manager Transparency Act (S. 127). […] The Pharmacy Benefit Manager Transparency Act (S.127) would go a long way towards addressing PBMs’ anticompetitive business practices that are putting many independent pharmacies out of business and creating ‘pharmacy deserts’ in minority and underserved communities, where the neighborhood pharmacy may be the only health care provider for miles.”
Association for Clinical Oncology
“The Association for Clinical Oncology (ASCO) applauds [Senators Cantwell and Grassley] bipartisan commitment to quality patient care and lowering the costs of prescription drugs. We are pleased to endorse the Pharmacy Benefit Manager Transparency Act of 2023.”
Association of Mature American Citizens
“On behalf of the over 2.2 million members of the Association of Mature American Citizens – AMAC, I write in support of S. 127, The Pharmacy Benefit Manager Transparency Act 2023. This bipartisan legislation will help drive down consumer costs for seniors by holding pharmacy benefit managers (PBM) accountable for the use of anti-competitive business practices.”
“The Autoimmune Association applauds the Senate, especially Senators Cantwell (D-WA) and Grassley (R-IA), calling for transparency on the practices of pharmacy benefit managers. … We are hopeful this legislation will shed light on the practices of PBMs, thus ensuring they become patient-centric.”
Biotechnology Innovation Organization
“The Biotechnology Innovation Organization (BIO) applauds Senators Maria Cantwell (D-WA), Chair of the Committee on Commerce, Science and Transportation and Chuck Grassley (R-IA), Ranking Member of the Judiciary Committee, for introducing the Pharmacy Benefit Manager Transparency Act of 2023 that would increase transparency and authorize the Federal Trade Commission (FTC) to hold pharmacy benefit managers (PBMs) accountable for unfair practices that harm patients.”
“IBD patients deserve to understand why PBMs are making the decisions that they do, and whether these decisions are financially motivated, or based on science. They should also share in any cost savings achieved by PBMs. The Pharmacy Benefit Manager Transparency Act would make great strides in revealing the true motives and operating practices of PBMs.”
“Senator Cantwell reintroducing bipartisan legislation to shine the light of transparency on the murky underworld of PBMs is more critical than ever. The top PBMs use their inordinate market leverage to delay and even deny patients their cancer medications, lowball payments to pharmacists resulting in pharmacy closures, and fuel drug costs higher for all Americans. The Senator’s leadership is so critical in stopping the destructive influence of PBMs.”
National Community Pharmacists Association
“The National Community Pharmacists Association is writing today in support of the reintroduction of the Pharmacy Benefit Manager Transparency Act, which would provide plan sponsors/employers much needed transparency on how PBMs administer their pharmacy benefit and clarify the Federal Trade Commission’s enforcement authority to prohibit unfair or deceptive business practices in which PBM-insurers engage in the commercial health insurance market. […] NCPA supports passage of the Pharmacy Benefit Manager Transparency Act.”
National Association of Manufacturers
“S. 127, the Pharmacy Benefit Manager Transparency Act of 2023 achieves important health care reform goals and manufacturers appreciate today’s review of PBM business practices. Manufacturers across the United States are constantly evolving to serve customers, innovate, grow business and reduce costs. The health care sector must go through the same process with a focus on pharmacy benefit managers with a focus on market-based principles that provide greater transparency without sacrificing patient care.”
“PBMs were originally conceived to discipline the cost of drugs and return savings to pharmacies and patients. Instead, over time, they have evolved into self-serving profit centers that add little value along the supply chain except to fill their own coffers. That is why we believe Senator Cantwell and Grassley’s Pharmacy Benefit Manager Transparency Act (S. 127) is a critical step in the right direction.”
“The PBM Accountability Project is working to ensure that patients, employers and unions are not overpaying for prescription medicines. Meanwhile, middlemen pharmacy benefit managers (PBMs) continue to find new ways to rake in profits at the expense of patients and plan sponsors. […] We write in support of the recently introduced Pharmacy Benefit Manager Transparency Act (S.127) that aims to curtail harmful PBM practices. We appreciate that the bill aims to prohibit exploitation of independent pharmacists through a number of harmful practices, including spread pricing and reimbursement clawbacks.”
Ryan White Clinics for 340B Access
“Thank you for introducing S. 127, the Pharmacy Benefit Manager Transparency Act of 2023. Ryan White Clinics for 340B Access (RWC-340B) is a national association of HIV/AIDS healthcare clinics and service providers receiving support under the Ryan White Comprehensive AIDS Resources Emergency (CARE) Act. RWC-340B lends its strong support to the legislation. […] S. 127 is an important step in combatting harmful discriminatory and predatory practices by PBMs and other third-party payers.”
“We are making progress on transparency of hospital prices. It is now time to get transparency of drug prices with PBM reform. @ChuckGrassley’s bill is a great step.”
Others have also written and spoken about bill’s positive impacts, which can be found below.
David Balat, Director of the Right on Healthcare Initiative at the Texas Public Policy Foundation
“At its invention, the stethoscope was revolutionary—the first non-lethal way of exploring a patient’s internal anatomy. It opened a new world to physicians. That’s the goal of the bipartisan Pharmacy Benefit Manager Transparency Act—a measure that is completely non-invasive, but that opens up a world of information about how our health care system delivers prescription drugs and what’s driving skyrocketing costs. […] I’m no friend to expanding government power—and this bill doesn’t do that. Instead, it empowers consumers with more information. PBMs will soon be a nearly $619 billion industry—and gobbling up more and more of our health care dollars. It’s time for some transparency. And the bipartisan PBM Transparency Act will achieve this, without injecting anything more lethal than some free market principles.”
USC Schaeffer Center for Health Policy and Economics Dr. Neeraj Sood and Dr. Karen Van Nuys
“This bill is a big step forward in making pharmaceutical distribution more efficient. There are several things to like about it. Most importantly, it puts transparency front and center, removing much of the current opacity that allows PBMs to hide profits from health plans and pharmacies. […] This should lower costs for health plans by either reducing the excessive PBM margins that plans are currently paying for, or by revealing information about spreads and other mark-ups so that health plans can comparison shop for PBM services with more complete information, pharmacies can have more information about reimbursements, and both can negotiate better contract terms with PBMs. […] The greater transparency promoted by the bill can highlight areas of inefficiency and spur policy solutions to address them.”
3Axis Advisors President Antonio Ciaccia
“Overtime, these obscure claims processors have grown into Fortune 15 companies. They are larger than the manufacturers and pharmacies they were hired to control. So what Senator Grassley’s legislation aims to do is to bring in some needed accountability for the perverse incentives and mark-ups that those intermediaries are inserting into prescription drug transactions … Chuck Grassley has been on the leading edge…”
Iowa pharmacists have also express their support for the bill in Iowa newspapers including the Daily Nonpareil, Quad City Times, and Waterloo-Cedar Falls Courier.
Reprinted with Permission from - Grassley Senate
740 mil over 10 years ? Am I supposed to take this seriously? Are we supposed to laugh, scream tear our hair out or what? We really are regarded as complete idiots .Throw them handful of crumbs and they’ll shut up
A good start! Savings has to come from somewhere! Maybe this can start a campaign to look for other areas to cut in the bloated government budget? It’s either cut spending or bankrupt the country and according to Biden, He seems to want the later!
A transparency act to enforce crooked politicians to be honest?
When the current proposed federal government budget put forth by Team Biden has exploded up to well over $6.4 trillion dollars from just $4.3 trillion a few years ago, I guess even a modest savings of $740 million dollars spread out over 10 years is better than nothing. Remember when millions used to actually be meaningful numbers in terms of federal spending bills? Ah the good days. Now millions, when discussed in terms of the federal budget, don’t even rate any real attention. On to flushing the next few billion dollars on some “progressive” plan to save the planet. ;-))
Remember this: DON”T STEAL, THE GOVERNMENT HATES COMPETITION.
Ha! Yes, so true!
This should have been done a long time ago.