Bill Ensures PBMs are Working to Lower Prescription Drug Costs
DENVER, CO– This week, bipartisan House Bill 1094 was introduced by Representatives Kyle Brown and Dusty Johnson to reduce the costs of prescription drugs for Coloradans by holding pharmacy benefit managers (PBMs) accountable. The bill will be sponsored in the Senate by Senator Byron Pelton and Senator Dylan Roberts.
PBMs act as middlemen in the healthcare system and are meant to negotiate lower prescription medication costs on behalf of health insurers, large employers, and ultimately Colorado patients. PBMs have recently faced growing scrutiny about their role in prescription medication costs. House Bill 1094 would prevent PBMs contracting with health plans in Colorado from designing drug benefits in ways that would increase costs.
The legislation would:
Encourage PBMs to generate revenue through a transparent, flat service fee.
Prohibit PBMs from profiting from practices like restricting access to affordable generic medications, or underpaying pharmacies.
Require PBMs to pass on savings to patients as intended.
“PBMs should be negotiating lower prescription costs on behalf of Colorado patients, but the way our system is set up, Coloradans may be paying more,” said Representative Brown. “In fact, over the past decade, profit growth of the largest PBMs increased by more than 430%. These PBMs have become so profitable that they are included among the Fortune 25 companies – ranked higher than the drug manufacturers they were meant to control.”
“Healthcare costs are rising for my constituents, and we need to tackle this problem from all angles,” said Representative Johnson. “Our bill prevents PBMs from profiting off complex pricing, ensures fair pharmacy reimbursements, and makes certain that savings from negotiations are passed on directly to Coloradans.”
Recent polling shows that 70% of Colorado residents experienced at least one healthcare affordability crisis in the past year, 83% worried about affording healthcare in the future, and 68% of all respondents had delayed or went without healthcare due to cost.
“We have heard from countless patients across the state who simply cannot afford the medications they rely on, and PBMs like other actors are playing a role in driving up those costs,” said Sara Froelich, Executive Director of the Chronic Care Collaborative. “We are thrilled to see lawmakers across the aisle coming together to ensure PBMs are behaving transparently and are accountable to Colorado patients.”
Learn more about PBMs and meaningful policy reforms to lower costs at pbmaccountabilityco.org.
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