Senators Mike Crapo (R-Idaho) and Ron Wyden (D-Oregon) introduced a bill on Thursday to increase transparency, accountability, and competition among pharmacy benefit managers (PBM).
The Modernizing and Ensuring PBM Accountability Act (MEPA) marks the latest bipartisan attempt to rein in the practices of PBMs, which function as a crucial link in the pharmaceutical supply chain.
PBMs negotiate drug prices with pharmaceutical manufacturers and manage prescription drug benefits for employers or health insurance plans.
CVS Health’s (NYSE:CVS) CVS Caremark, Cigna’s (NYSE:CI) Express Scripts, and UnitedHealthcare’s (NYSE:UNH) Optum control about 80% of the U.S. PBM market.
“The comprehensive proposals included in this bill will enhance oversight of pharmacy benefit managers and improve incentives across Medicare and other federal health programs,” Senate Finance Committee Ranking Member, Crapo said.
“Today’s introduction marks the next step towards taking on health care middlemen that are driving up costs for seniors and taxpayers,” the Committee Chairman Wyden remarked.
Among its other measures, the bill seeks to prohibit tying PBM’s compensation in Medicare to a drug’s sticker price and aims to provide relief to independent pharmacies, which often have to bear the brunt of PBM’s damaging business practices.