Proposal To Regulate Pharmacy Benefit Managers Passes Out Of Senate
A proposal to regulate an obscure but important player in the prescription drug industry divided Democrats and Republicans as it passed out of the state Senate today.
Sen. Albert Olszewski, a Republican from Kalispell, is carrying SB 71 on behalf of Montana’s Insurance Commissioner Matt Rosendale.
It aims to regulate pharmacy benefit managers, PBMs, that negotiate deals between insurance companies, drug manufacturers, retail pharmacies and government health plans.
PBMs say the deals they strike help lower drug costs, but on the Senate floor today Olszewski, who is a physician, called them middlemen.
“Unfortunately, there are bad actors in this industry that act like a pharmaceutical mafia, and that harms Montana patients, Montana’s pharmacists and Montana's insurance companies,” he says.
However, some Democrats say the way the bill tries to regulate PBMs could cause problems.
Federal law prevents the state from going after PBMs directly, so SB 71 proposes new rules on insurance companies and their relationships with pharmacy benefit managers.
Missoula Democrat Sue Malek says the bill could put tens of thousands of dollars in fines on insurance companies.
"These insurance companies, their budgets will be thrown out of balance and it will cause them to raise premiums yet again," she says.
Seven Democrats, including the minority leader, joined Republicans to pass the bill out of the Senate.