By: Holly Michels
Montana’s Insurance Commissioner pitched a bill to state legislators Friday to root out what he calls shady practices by middlemen in the prescription drug industry that he said would lower the cost of medications for Montanans.
Instead of directly going after pharmacy benefit managers, which sit at the nexus of interactions between pharmacies that sell drugs, health insurance companies that cover patients and the manufacturers that make medications, the legislation tries to dictate what sort of contracts insurance companies can enter with those middlemen.
At the end of that complex chain are consumers who state Commissioner of Securities and Insurance Matt Rosendale argues are harmed and face higher drug prices because pharmacy benefit managers skim a bit off the top of each transaction they facilitate.
Pharmacy benefit managers are hired by insurance companies to process claims at the pharmacy and negotiate prices with pharmacies and drug manufacturers.
Rosendale argues pharmacy benefit managers can profit in several ways that harm consumers in the end. Senate Bill 71, carried at his request by state Sen. Al Olszewski, R-Kalispell, aims to stop some of those practices.
The bill would require that rebates not go to the don’t go to the pharmacy benefit managers, but instead go to the insurance companies so they could use the money to lower premiums.
Read more at the Helena IR