Arkansas Insurance Department goes after pharmacy benefit managers with hearings, $1.5 million penalties

LITTLE ROCK, Ark. – Arkansas is going after pharmacy benefit managers that the insurance department claims are violating state laws.

A release from Governor Sarah Huckabee Sanders' office on Tuesday said she was joining Insurance Department Commissioner Alan McClain in imposing penalties and hearings against four PBMs in the state.

PBMs are companies that negotiate drug prices and administer prescription drug provisions for health insurance plans, large employers and Medicaid recipients, acting as middlemen between pharmacies and patients.

The release said the state is focusing on four major PBMs: Caremark, Magellan, Express Scripts, and MedImpact. The four are alleged to have violated a June 28 bulletin from the insurance department advising PBMs to stop paying pharmacies below the national average drug acquisition cost (NADAC), with a $5,000 fine for each violation.

Officials said Caremark is alleged to have committed approximately 217 violations of payment below the NADAC, with Magellan at 50 alleged violations and Express Scripts at 19 alleged violations. They added that the $1.47 million in possible fines total makes this the largest pharmaceutical enforcement action in Arkansas history.

“The Department is committed to tackling PBM abuses,” McClain said. “It’s time for them to make fair and reasonable payments to our pharmacies, as required by the law, and we will enforce all elements of payment and PBM licensure statutes that violate state law, no matter the amount.”

KARK 4 News reached out to the named PBMs for a response but did not receive one when this story was published. If a response is received, this story will be updated.

from KARK https://ift.tt/lgGqtwC