Doctors in ‘pill mill’ arrests suing Carmel, DEA agent

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Doctors in ‘pill mill’ arrests suing Carmel, DEA agent

http://www.heraldbulletin.com/news/local_news/doctors-in-pill-mill-arrests-suing-carmel-dea-agent/article_82811a60-f788-11e6-a867-83fddbf61da2.html

INDIANAPOLIS — A team of doctors initially accused of operating a “pill mill” is suing the city of Carmel and a Drug Enforcement Agency agent for false arrests they say destroyed their careers.

The physicians include Dr. George Agapios, who had a Pendleton family practice and was working part-time for a Carmel opiate addiction treatment clinic when he was charged in 2014 with five felonies involving dealing in a controlled substance. The charges, filed by the Indiana Attorney General’s office, were dismissed in Hamilton County Superior Court in December 2015.

Charges against three other doctors were either dropped or ended in acquittal.

 The doctors’ complaint, filed recently in U.S. District Court for the Southern District of Indiana, is a continuation of a federal lawsuit they filed in 2016 against a number of entities including the city of Kokomo and Hendricks County. However, many of those defendants were dismissed from the initial lawsuit.

The new complaint is against DEA agent Gary Whisenand, the city of Carmel and Carmel police officer Aaron Dietz.

In Carmel, the group’s clinic was operated as the Drug & Opiate Recovery Network (DORN) where Suboxone, used to manage pain and relieve opioid dependency, was often prescribed but not dispensed, court documents said.

 DORN’S medical director was Dr. Larry Ley. Dr. Ronald Vierk was an anesthesiologist at Reid Hospital in Richmond and practiced part-time at a DORN office in Richmond. Dr. Luella Bangura was a Lafayette family physician who practiced part-time at DORN’s Kokomo office. Agapios is the fourth plaintiff in the complaint.

DORN’s main clinic was in downtown Carmel.

The lawsuit claims “The presence of a clinic specializing in the treatment of opioid dependency in Carmel, Indiana, was in visible contrast to the political position of the Carmel city administration that there was no significant opioid drug addiction problem in Carmel, Indiana, that would require such a facility.”

FAILED: proposed legislation that would have cut the MJ eradication program’s funding in half

DEA’s Marijuana Eradication Program in Washington State

http://northwestcannacast.com/deas-marijuana-eradication-program-in-washington-state/

SEATTLETIMES.COM – It’s a scene that continues to unfold in Washington state: A helicopter hovers low over the trees, deep inside a park in the Cascade Mountains a SWAT team dressed in Kevlar rappels from the chopper to the ground other officers, federal agents and state environmental officials move toward the site on foot, alert for armed guards, booby traps and razor fencing.

The targets of these taxpayer funded efforts aren’t terrorism suspects or dangerous fugitives they are marijuana plants.

The Drug Enforcement Administration (DEA) has for decades poured millions of dollars into a nationwide marijuana eradication program, and the effort continues even in Washington, where the drug was legalized for recreational use in 2012. Financial documents obtained from the DEA show that in fiscal year 2016, Washington was the nation’s fourth largest recipient of eradication funding, at $760,000. According to the most recent data, each plant the state destroys costs taxpayers $26.49, over six times the national average.

Washington’s funding has fallen 28 percent over the last three fiscal years, from about $1.1 million. But funds for the DEA’s marijuana eradication program have seen larger cuts in other states where the drug has been legalized, according to the financial documents. Colorado’s funding dropped to zero over the past two fiscal years. Oregon’s budget has been slashed by 80 percent from $1 million to $200,000 during the same time.

Upon release of the DEA’s financial documents, a bipartisan group of eight members of Congress sent a letter in October to the U.S. Government Accountability Office that called the program’s roughly $18 million annual cost wasteful.

“While the DEA’s Cannabis Eradication Suppression Program has been in effect nationwide for three decades, the recent trend in state laws to legalize and decriminalize the production, distribution or consumption of marijuana calls into question the necessity of such a program,” the letter states.

One of the letter’s signees, U.S. Rep. Ted Lieu, D-Calif., proposed legislation last year that would have cut the eradication program’s funding in half. The effort failed.

Lieu, in an interview with The Seattle Times before the November election, said that legalization of recreational marijuana in California the nation’s top cultivator would force the DEA to reassess the feasibility of trying to suppress the country’s supply. The election saw voters in California, Maine, Massachusetts and Nevada approve measures to legalize marijuana for recreational use. Voters in Arkansas, Florida, Montana and North Dakota approved the drug for medical use.

Legalization will accelerate discussions of whether the drug’s national prohibition can be maintained, Lieu said.

“I don’t believe the arguments that this program is needed. From a taxpayer’s standpoint, it doesn’t make any sense that Washington state is still spending so much money on marijuana eradication,” Lieu said. “There are so many more worthwhile uses for it.”

Lt. Chris Sweet of the Washington State Patrol has managed the state’s eradication program since 2013, mainly by requesting and administering federal funds. Sweet said that when he attends law-enforcement conferences, he’s frequently asked how he can operate a marijuana-eradication program in a state where the drug is legal.

“I hear it all the time: ‘You guys still have an outdoor-eradication program when you’re a legalized state? How does that make sense?’ ” Sweet said.

Eradication remains a law-enforcement priority because Mexican drug cartels may have moved their marijuana-growing operations north of the border, where the climate produces higher-quality plants, Sweet said. These organizations tend to operate on swaths of public land, often in mountainous regions, where detection of large crops is difficult.

The abundance of good growing terrain along the eastern slopes of the Cascades has led the Sinaloa Cartel of Mexico — considered the world’s most powerful drug-running operation — to operate in that region for some time, according to a recent joint report from the DEA and Department of Justice.

The presence of Mexican drug cartels might explain why Furadan, a pesticide banned in the United States and “only made south of the border,” has been found on Washington’s illicitly grown marijuana crops, Sweet said. California authorities have also cited the pesticide as evidence of Mexican involvement in grow operations there. Starting this year, Sweet said, officers removing illegal marijuana plants must wear protective suits and be accompanied by Department of Ecology agents.

The DEA’s eradication program gained national attention in September after a helicopter, a bevy of police vehicles, state police officials and National Guard troops descended upon the home of an 81-year-old Massachusetts woman to haul off a single marijuana plant growing in her garden.

However, small growing operations are not typically targeted by the program. The average size of a Washington crop bust in 2015 was 609 plants; the average size nationally was 519, according to DEA records.

There have been roughly 57,000 plants eradicated in Washington so far this year, a 63 percent increase over 2015’s total haul. Sweet believes the involvement of Mexican drug cartels helps explain the rise in plant discoveries this year.

“No one had a crystal ball about how legalization would affect our outdoor growing, but with the spike this year, we’ll have to see what the coming years bring,” he said. “Is it a freak thing? It’s too early to tell.”

But the DEA’s records show that the number of plants found in Washington this year is almost identical to the number found two years ago, and down significantly from the 346,484 plants eradicated five years ago. Nationwide, the records show a nearly 70 percent decrease in the number of grow sites eradicated between 2010 and 2014.

Morgan Fox, communications manager of the Marijuana Policy Project, the largest U.S. nonprofit dedicated to marijuana reform, said the best way to limit the impact of drug cartels is to “eliminate the illicit market, and make it not worth it economically. That’s what we see legalization doing.”

“Law-enforcement organizations are loath to give up on funding sources, so there are times there is a concerted effort to tell a dramatic story,” Fox said. “Marijuana eradication is just playing whack-a-mole.”

In justifying the program’s continued existence in Washington, Sweet cited the need to fight Mexican gangs, and to mitigate the environmental damage caused by grow operations. The fact the program has been slashed in Colorado and Oregon is ominous to him, he said.

“We’ve seen the proposals in Congress, and the public perception, and the adage that this is money that can be used for other programs, like education and treatment,” Sweet said. “That’s definitely a big concern.”

For Fox, the fact eight more states legalized pot this November illustrates the program’s increasing irrelevance. After alcohol’s prohibition, he said, a criminal element remained in the industry for a while but diminished as the legal market established itself.

“We don’t see illicit criminal organizations planting secret vineyards on national parks when the market has been made legal for wine,” said Fox. “There’s still some illegal moonshine stills around the country, but it’s not a big issue. This is where we’re headed as a country.”

 

Pharmacist wins Walmart lawsuit

 
Pharmacist complained about staffing conditions/levels became DEPLORABLE – untrained – insufficient- inexperienced – creating a “public safety concern”
This is in NH… and the PRIMARY CHARGE of the Board of Pharmacy is to PROTECT the public’s health and safety.
I am surprised that the TV reporter did not interview someone from the NH Board of Pharmacy.
The Boards of Pharmacy are “stacked” with non-practicing corporate Pharmacists… working for the same chains that they are suppose to oversee and regulate. Some believe that this could present a conflict of interest. Since most Boards of Pharmacy member are appointed by the state’s Governor…  You can come to your conclusion as to why it is mostly Pharmacists/employees of large corporations that get appointed to the boards.

Primer on Whistleblowing in Healthcare

Primer on Whistleblowing in Healthcare

http://bnlawatlanta.com/wp-content/uploads/2014/05/Healthcare-Whistleblowing-April-14.pdf

http://bnlawatlanta.com

This was sent to me by a middle aged Pharmacist who has just gotten toss to the curb because of nebulous issues of corporate policies and procedures being theoretically broken. 

Any employee that works for a business that deals with receiving Federal money, could learn a lesson from this primer from a law firm in Georgia.

Document what “wrong doings” that your employer is doing like tomorrow is going to be your last day on the job.

 

This was posted on another FB page… FYI !!!

Hey folks, here’s an opportunity to maybe change the dialog on opioid hysteria. NPR has a sunday morning program called the “Call In Show” and next week the question is “How has the opioid epidemic effected you?” We should all call in- dial 202-216-9217 with full name, where you are calling from and your story! Maybe if they hear from enough of us they will start showing how this is hurting chronic pain patients and our abilities to receive adequate pain relief…

Why Congress doesn’t need to repeal ACA/Obamacare

Humana has already announced that they will no longer participate in Obamacare in 2018 and the CEO of Aetna recently stated that “they had not made the decision yet about 2018 ” If both of these very large ACA providers are not participating in 2018, that means that there will be a lot of areas that will not have the first insurance company to sell policies and competition in a lot of areas will be limited to just one provider… basically NO COMPETITION.
All Congress has to do is repeal/rescind the premium subsidies and the ACA will collapse under its own weight… when people are expected to pay the “full rack rate” for their health insurance premiums.

Insurance can’t even approach an “affordable level” unless all that expect/need coverage participate.  Below is a table of per-cent of drivers that are uninsured per state.. from a low of  3.9% (Mass) to a high of 25.9% (OK). Every state has MANDATORY VEHICLE INSURANCE.

http://www.carinsurance.com/Articles/uninsured-motorist-coverage-state-averages-of-uninsured-drivers.aspx
Estimated percentage of uninsured motorists by state

State          Uninsured Rank (2)       State                   Uninsured        Rank (2)
Alabama        19.6%        7                  Montana              14.1%                  15
Alaska            13.2           21                Nebraska              6.7                       44
Arizona          10.6           29               Nevada                  12.2                     23
Arkansas       15.9            11                New Hampshire  9.3                       34
California      14.7            13               New Jersey           10.3                     30
Colorado       16.2             9                New Mexico          21.6                     4
Connecticut   8.0            41               New York               5.3                       49
Delaware        11.5           27               North Carolina     9.1                        35
D.C.                 11.9           24               North Dakota       5.9                        47
Florida (3)     23.8          2                 Ohio                       13.5                        17
Georgia          11.7            26              Oklahoma             25.9                        1
Hawaii           8.9             37              Oregon                     9.0                        36
Idaho             6.7             45               Pennsylvania          6.5                        46
Illinois           13.3          20                Rhode Island         17.0                        8
Indiana         14.2           14                South Carolina      7.7                          43
Iowa              9.7             32                South Dakota        7.8                          42
Kansas          9.4            33                Tennessee               20.1                        6
Kentucky      15.8           12               Texas                        13.3                         19
Louisiana      13.9          16               Utah                          5.8                          48
Maine            4.7            50               Vermont                  8.5                           39
Maryland      12.2          22               Virginia                   10.1                          31
Massachusetts3.9         51                Washington           16.1                          10
Michigan       21.0          5                 West Virginia         8.4                           40
Minnesota    10.8          28               Wisconsin               11.7                          25
Mississippi   22.9          3                 Wyoming                8.7                            38
Missouri        13.5          18

I would suspect that you will find similar numbers of people driving cars that don’t have a driver’s license.

It is estimated that the USA has a 1-2 TRILLION/yr  underground economy and the income taxes evaded on that money… would close the annual deficit in the Federal budget… about 600 billion/yr

http://www.alternet.org/story/152446/inside_the_trillion-dollar_underground_economy_keeping_many_americans_%28barely%29_afloat_in_desperate_times/

Congress has mandated that hospital have to treat/stabilize anyone walking thru their doors… seeking treatment. Also medical bills are the largest single reason for personal bankruptcies.  Meaning that a lot of “small businesses” – doctors, pharmacies, hospitals end up “eating” those $$$ wiped clean with a person declaring bankruptcy.

Let’s approach this issue of providing healthcare in a business like manner.. even though Obamacare has abt 20 million people with coverage.. we still have abt 30 million that still doesn’t have any health insurance.

Lets start with a 5% sales tax very soon and beginning with 2018 let everyone enroll into Medicare in their birth month. Like most sales taxes… food, medication, rent, utilities will be exempt. Phase out Obamacare in the same manner. Everyone will have a deductible of maybe 5% of their gross income, and will pay 20% after the deductible. There will be no more prior authorizations, quantity limits, step therapy and the rest of the BS that insurance companies have put in place in order to “save the system money”,but has done more to establish their dictatorship over our healthcare and help “pad their bottom line”.  Those currently on Medicaid or getting some sort of subsidy will continue to get some sort of subsidy.

The sales tax rate will be adjusted annually based on one year back actual cost per capita to provide healthcare to our citizens.  No system will ever be perfect, but we need to strive to improve upon what we have failed to do to date. The transition will be neither painless nor transparent, but there are no quick fixes.

bill in West Virginia to add kratom to their controlled substances list

From Susan Ash Director of The American Kratom Association

Folks, we have a new bill in West Virginia to add kratom to their controlled substances list (its been included under the misconception that its contributing to the existing opiate problem there). But we are on top of the situation and there is no need to panic. Let’s let our lobbyists continue to work behind the scenes and give us direction on what we can be doing after the weekend. Thanks

 

Another case of politicians/bureaucrats trying to protect us from ourselves ?

Express Scripts net profit last fiscal year 2.4 BILLION

Express Scripts CEO addresses drug pricing ‘misinformation’

http://www.stltoday.com/business/local/express-scripts-ceo-addresses-drug-pricing-misinformation/article_8c65cf2a-96ef-5575-8b5c-95601ac51840.html

The nation’s largest pharmacy benefit manager is defending itself against accusations that it’s partly to blame for high drug prices.

Express Scripts Chief Executive Tim Wentworth delivered a strongly worded response to such claims during an earnings call Wednesday.

“Let me first say that in my nearly 20 years in the PBM business, I have never been prouder of the results we create, but I’ve never seen more misinformation and absence of facts in the dialogue about our role.”

 Express Scripts has faced increased scrutiny since a congressional hearing last summer when Heather Bresch, CEO of EpiPen maker Mylan, said the entire drug supply chain was responsible for price increases. That would include pharmacy benefit managers such as Express Scripts.

Express Scripts negotiates the cost of drugs directly with pharmaceutical companies and provides prescriptions to about 85 million Americans each year through employer-based coverage.

“Let me start with the facts,” Wentworth said during Wednesday’s call. “Drug companies set drug prices, and over the last eight years, those list prices have increased by more than 200 percent. If not for us, our clients and patients would be left to pay those costs. Drugmakers set prices, and we exist to bring those prices down to ensure patients can access the drugs they need and that payers can afford them.”

Rebates are one of the most popular tools used to lower drug prices. Wentworth said Express Scripts’ clients received 89 percent of the rebates the company negotiated with drug manufacturers. Express Scripts had not shared that figure in recent years.

Express Scripts has a national preferred formulary, which is a list of drugs it covers. Because Express Scripts filled 1.4 billion prescriptions last year, manufacturers want to have their drugs on that formulary. To get listed, they agree to rebates.

 Typically, after dispensing drugs to patients, a drug manufacturer will write Express Scripts a rebate check.

That timing can expose some patients, especially those with high deductibles, to the full cost of a drug, said Rachel Sachs, an associate professor of law at Washington University. She focuses on health law and food and drug regulation.

PBMs serve a function, Sachs said, but they are partly to blame for high drug costs. Ultimately, she said, there’s not a lot of transparency in how the rebates are passed through to patients.

Express Scripts tried to provide more information on Wednesday’s call.

Wentworth said Express Scripts sometimes passed the entire rebate through to its client, which is an employer or health insurance company, and the client decides what to do with the money.

“One hundred percent of the time, our clients determine how to share rebates,” Wentworth said.

Sometimes clients share the rebate with Express Scripts, and sometimes Express Scripts keeps all of it.

“To suggest that our creating competition and the resulting rebates is why prices go up is uninformed and simply wrong,” Wentworth said.

4 Nasty Ways Federal Prohibition Hurts Pots Smokers—Even Where It’s Legal Marijuana may be legal where you live, but it remains illegal under federal law.

4 Nasty Ways Federal Prohibition Hurts Pots Smokers—Even Where It’s Legal

Marijuana may be legal where you live, but it remains illegal under federal law.

With the ascension of California, Maine, Massachusetts, and Nevada to the ranks of the legal marijuana states after last November’s election, nearly a sixth of the country now lives in places that have freed the weed.

Still, even though it may be legal under state law, marijuana remains prohibited under federal law. Pot smokers in California or Colorado don’t have to worry about a DEA agent breaking down their doors and taking them off to federal jail—there just aren’t enough DEA agents to actually enforce prohibition on the individual level. But the fact is, they are using a federally illegal substance, and there can be consequences to that.

1. Jobs

Most employment in the U.S. is “at will,” meaning employers can fire employees for any reason they like—or no reason at all—unless it violates anti-discrimination laws. That means employers can fire or refuse to hire marijuana users even where marijuana is legal, just as some companies have done with tobacco users.

For many employers, having a “no marijuana” provision is merely a choice, one that can be changed by changing norms and attitudes or, perhaps, by a paucity of applicants willing to work for a company that intrudes on their personal liberties. But for other employers, federal marijuana prohibition means they must bar marijuana use. That includes all federal agencies, many companies that contract to do federal work and sectors like the transportation sector, where federal law mandates drug testing and the firing of people who use federally illegal drugs.

2. Housing

Federal marijuana prohibition means no one living in Section 8 or other federally subsidized housing can use marijuana. Typically, housing authorities do not drug-test or otherwise attempt to screen residents or applicants for marijuana use, but they do see and act on reported violations or arrests reported to them, and the pot-using residents get evicted.

And residents don’t even have to be using marijuana themselves. There are many federal housing horror stories of long-time, elderly residents being evicted from their homes because their children or grandchildren got caught using or possessing pot on the premises. Young stoners: Do not get your grandma thrown out on the street by getting caught with weed at her place!

But it isn’t just residents of public housing. Renters, condo owners and mobile home park residents can all be subject to codes or codicils that no local, state, or federal law be violated. And smoking pot in a legal state is still a violation of federal law.

3. Gun Ownership

A federal appeals court has ruled that marijuana users do not have a Second Amendment right to gun ownership because federal law does not allow selling guns to “illegal” drug users. That ruling came in a case involving a medical marijuana patient, but it applies to all marijuana consumers because Congress thinks that marijuana use “raises the risk of irrational or unpredictable behavior with which gun use should not be associated.” (Alcohol, which certainly fits that criteria far more closely than marijuana does, is not included in the ban because it is a federally legal substance.)

The Bureau of Alcohol, Tobacco and Firearms wrote that decision into its rules last month, adding a new line to the gun ownership application form that states that marijuana is still illegal under federal law. For some reason, the National Rifle Association has not bestirred itself over this particular assault on gun owner rights.

Under current law and federal pot prohibition, would-be gun buyers face a dilemma: Lie about marijuana use and be able to get a gun, or be honest about marijuana use and be barred from buying one.

4. Military Service

Though marijuana has shown promise in treating conditions such as PTSD and chronic pain, active military members can’t use it without jeopardizing their careers. Facing social reality, some branches of the service are no longer barring recruits with a history of marijuana use, even if current, but it will still get service members in trouble and possibly booted from the service. 

PBM’s: driving up the cost of drugs through various opaque practices

Lawsuit seeks to answer who is to blame for skyrocketing drug prices

http://www.bozemandailychronicle.com/news/national/health/lawsuit-seeks-to-answer-who-is-to-blame-for-skyrocketing/article_0ffd9609-ad03-53f5-8507-fc5a3982e548.html

DAYTON, Ohio (TNS) — An unnamed Dayton man is at the center of a $15 billion lawsuit that pits two often vilified segments of the health care system against one another over the cost of prescription drugs.

John Doe One is an HIV/AIDS patient whose bills for the life-saving drug Atripla — even with insurance coverage — have been more than $1,200 a month, according to the class-action federal lawsuit in which he’s a lead plaintiff.

The man and other patients who get their health coverage through Anthem Inc. are suing pharmacy benefit manager Express Scripts, claiming the company schemed to inflate prescription drug prices affecting 38 million patients.

It is just the latest in a series of legal actions and accusations against the pharmacy benefit manager industry — middlemen in the prescription drug supply chain — for driving up the cost of drugs through various opaque practices.

The system for pricing prescription medication is shrouded in layers of complexity and hidden from public view, making it virtually impossible for consumers to know whether they are paying a just price at the drug counter. And because high sticker prices get spread throughout the health care system, everybody pays when prescription drugs have high markups.

Just who is to blame the skyrocketing costs is a subject of intense debate. But the legal fight between Anthem and Express Scripts has shined a spotlight on the increasing role being played by pharmacy benefit managers, who now wield power over many aspects of the prescription world, from how much drugs cost and which ones are covered or excluded by health plans to the very pharmacies patients are allowed to use.

The role of pharmacy benefit managers, or PBMs, has grown by leaps since the 1970s, when health plan sponsors began contracting with these companies as claims processors. Contrast that with today, where three PBMs control prescription benefit coverage for about 70 percent of insured individuals in the United States.

“When you have an industry of that size, that grew $80 billion over the last two years from basically about $300 billion to $380 billion, to me it should be a front page story every single day,” said Kyle Fields, president of Waynesville pharmacy benefit management company ApproRX.

Part of the reason the role of pharmacy benefit managers is obscured is so few members of the public understand how the system works. And those in the industry have wildly different opinions about whether PBMs are good or bad for the consumer. The following information should give you a better sense of how drug prices are set and help you determine whether you are paying too much.

The argument for PBMs

The giant companies that form the PBM industry say they provide huge benefits for the consumer. Here’s how:

Leverage. With their millions of patients, PBMs can negotiate rebates from drugmakers in exchange for offering a manufacturer better placement on the formulary that says which drugs are covered by the health plan and which are not. The PBM industry says the rebates save employers about 30 percent annually on their prescription drug costs.

Competition. PBMs say their negotiations drive competition because they are able to use their immense size to the advantage of their customers. Express Scripts represents 85 million members of 3,000 different health plans, according to spokesman Brian Henry. “(We’re) able to pit drug companies against each other,” he said. “Like anything else in the marketplace, you’re better off when there’s competition.”

Improved patient care. PBMs employ physician panels to help create drug formularies they say favor the drugs with the best outcomes for patients at the lowest price.

Exclusion lists. PBMs says they stand up to Big Pharma by refusing to cover higher-priced drugs when there are cheaper competitors of the same quality.

Online pharmacies. Express Scripts and others own mail-order pharmacy businesses that are often cheaper and offer more convenient options for patients. They say automation has cut down on pharmacy errors which can be deadly.

Leverage. With their millions of patients, PBMs can negotiate rebates from drugmakers in exchange for offering a manufacturer better placement on the formulary that says which drugs are covered by the health plan and which are not. The PBM industry says the rebates save employers about 30 percent annually on their prescription drug costs.

Competition. PBMs say their negotiations drive competition because they are able to use their immense size to the advantage of their customers. Express Scripts represents 85 million members of 3,000 different health plans, according to spokesman Brian Henry. “(We’re) able to pit drug companies against each other,” he said. “Like anything else in the marketplace, you’re better off when there’s competition.”

Improved patient care. PBMs employ physician panels to help create drug formularies they say favor the drugs with the best outcomes for patients at the lowest price.

Exclusion lists. PBMs says they stand up to Big Pharma by refusing to cover higher-priced drugs when there are cheaper competitors of the same quality.

Online pharmacies. Express Scripts and others own mail-order pharmacy businesses that are often cheaper and offer more convenient options for patients. They say automation has cut down on pharmacy errors which can be deadly.

The argument against PBMs

Critics of the tactics used by pharmacy benefit managers include pharmacists, patient advocacy groups and even some other pharmacy benefit managers. They say PBM pricing practices and a lack of transparency are driving up costs and causing insurers to pay inflated prices without knowing it — eventually passing those costs on to their members.

The rebates themselves are controversial, and some argue that they result in no savings to the consumer because manufacturers simply factor rebates into the price they charge for the drug. PBMs have also been accused of keeping an undisclosed amount of the rebates they negotiate while offering their clients a much smaller cut.

Many PBMs also collect a “spread” on each prescription that gets processed. If a pharmacy charges $40 for a prescription, the PBM would actually bill the health plan $40 plus 5 percent, and keep the difference.

The pharmacy benefit managers argue the rebates and spread pricing are written into the contracts signed by PBMs and their clients. But critics say it can be difficult for health plan sponsors to determine how much the pharmacy paid or how much a rebate was worth, thereby obscuring whether or not they are getting the best deal.

The rebates the big PBMs negotiate are “the best kept secret in health care,” said Antonio Ciaccia, director of Government and Public Affairs for the Ohio Pharmacy Association.

“Any time you have any marketplace where there are layers of people in the middle and the transactions within are not transparent, then you’ve got an arbitrarily inflated price waiting to happen,” added Kevin Schlotman, CEO of Benovation Healthcare, a third party health plan administrator based in Cincinnati.

“We can’t assess the true economic impact of exclusion lists,” he said in an August blog post. “The PBMs can claim to be standing up to pharma on behalf of payers, regardless of the actual dollar or patient impact.”

Critics also question the motives of PBMs, who often make a percentage of a drug’s list price.

“You start getting into the questions of, ‘if I’m a pharmacy benefit manager, and my compensation is better if patients have more expensive drugs, am I disincentivized from making sure people are gravitating toward lower-cost drugs?,’” Schlotman said. “There’s a potential conflict of interest there.”

But both Express Scripts and the PBM trade group Pharmaceutical Care Management Association say PBMs make more money when prices are lower because they can attract more clients. Prices are 100 percent controlled by the manufacturers, according to the PBM industry.

“It would be better for everyone if drug companies just offered lower prices,” said Mark Merritt, president of PCMA. “To try and blame PBMs for high drug prices would be like Sony raising the price of televisions and then blaming it on Wal-Mart’s discounting practices. … It just doesn’t make any sense.”

Which side is right?

Whether PBMs are giving their clients the best deal or not ultimately depends on what the contract says. And health plan experts say employers need to be more savvy in asking about rebates and spread pricing when negotiating those contracts.

“I’m not opposed to someone who brings great value to my clients getting paid, and getting paid well,” said Schlotman, whose company customizes health care plans for employers. “There’s a difference between getting paid well and getting paid a bunch of money that nobody knows about.”

Schlotman offered this scenario to show how employers can work to get the best deal possible from their pharmacy benefit managers. A PBM may offer an employer a discount on their administration fees, say $5 a month per employee. With 300 members, that’s a savings of $18,000. But by asking more questions the employer may discover the PBM received a rebate from the manufacturer for $75,000. That information can then be used when negotiating the next contract.

Marc Sweeney, founding dean of the School of Pharmacy at Cedarville University and a health benefits consultant, said there is no blanket statement to say which side in the debate over pharmacy benefit managers is right.

“Across every drug everyone is getting gouged, that’s not a true statement. Across every drug (PBMs) are actually helping reduce cost, well that’s not a true statement,” he said. “On some drugs they are helping reduce cost and in other cases they’re not.

“If you go to the patient level I know there’s a lot of frustration because patients have to deal with chronic conditions, and people are making decisions whether or not to purchase food in some cases because they’re trying to afford medication.”