Senior Care Pharmacy Coalition (SCPC) Slams PBM Industry Attempt to Hide Behind Non-Interference Clause to Sustain Anti-Competitive Price Gouging

DATE: January 24, 2018

National LTC Pharmacy Advocacy Group Says Congress Never Intended Clause to be Misused to Undermine Free-Market

Washington, DC – Commenting further on the Centers for Medicare & Medicaid Services (CMS) Medicare Parts C and D Proposed Rule, the Senior Care Pharmacy Coalition (SCPC) today slammed the pharmacy benefit manager (PBM) industry’s blanket attempt to claim CMS cannot ban or otherwise exercise oversight over extraneous “pharmacy fees” and related anti-competitive practices because the Medicare Part D “non-interference” clause prevents any oversight of PBM practices whatsoever, however egregious.

“While the non-interference clause does create guide rails to structure the agency’s oversight of PBMs, it is not an absolute bar to appropriate oversight,” said Alan G. Rosenbloom, President and CEO of SCPC, the only federal advocacy organization devoted exclusively to the interests of long term care (LTC) pharmacies and their elderly patients.

Despite the fact PBMs and their lobbying group, the Pharmaceutical Care Management Association (PCMA), claim otherwise, “Congress never intended that the clause be misconstrued to undermine the free market in such reckless, unfettered fashion,” Rosenbloom continued. In fact, the SCPC President and CEO said, “CMS has concluded that PBM abuses related to pharmacy fees are incontrovertible, and the agency undoubtedly has the legal authority to act.”

In its new comments to CMS, SCPC argues that PBMs increasingly have extracted “pharmacy payment adjustments” and other concessions from independent LTC pharmacies through anti-competitive market manipulation, without justification or benefit to Part D beneficiaries or the Medicare program. “The agency is correct – and the evidence is overwhelming that so-called ‘pharmacy incentive payments’ have ‘grown faster than any other category of DIR received by sponsors and PBMs,’ and that because the amounts exceed ‘bid’ calculations, they do not help beneficiaries or the program — but instead are being misused by PBMs to contribute to plan profits.”

Concluded Rosenbloom: “PCMA’s unreasonable position that the non-interference clause, a linchpin of the free market basis for Part D, should be construed to support and sustain anti-competitive practices detrimental to beneficiaries and competition is perverse and nonsensical. SCPC urges policymakers both at CMS and on Capitol Hill to act consistent with the free market principles inherent in Part D — and to prevent PBMs from continuing abusive, anti-competitive practices.”

####

The SCPC is the national association for independent LTC pharmacies. Our member pharmacies provide care and services to patients in LTC facilities across the country occupying approximately 675,000 beds. Visit seniorcarepharmacies.org  to learn more.