The Minnesota Senate today unanimously passed a bill to improve oversight of Pharmacy Benefit Managers (PBMs), the middle men in the supply chain of getting medicines to patients. This bill requires transparency and accountability for PBMs, eliminates gag clauses, and mandates adequate pharmacy networks. It also enables pharmacists to substitute more affordable alternative medications on behalf of patients and allows patients to synchronize their medication fill-dates once a year without cost. Under this new law the common PBM strategy of clawing back dollars from local pharmacies and utilizing rebates for their own self-interest will end.

“When it comes to controlling health care costs, tackling the impact of pharmacy middle men responsible for driving price increases is one of the simplest, most commonsense things we can do,” said Sen. Jeremy Miller. “It’s a small part of a much larger effort to make health care more affordable, but it will make a huge difference for families who have to purchase prescriptions like epi-pens or insulin.”

Patient protection reforms contained in the bill include:

• Requires PMBs act in good faith and notify health plans of conflicts of interest.
• Requires new transparency measures of PBMs.
• Mandates PBMs disclose any pharmacy ownership interests they have and prohibits them from offering incentives or imposing penalties that could direct patients to pharmacies they own.
• Prevents pharmacies from dispensing a drug to the consumer if there is a less expensive equivalent.
• Requires PBMs to disclose out-of-pocket cost differences between preferred network pharmacies and regular, in-network pharmacies.
• Requires pharmacies to inform customers if they can save money by paying cash for their drugs rather than involving insurance.