Latest news with #PharmacyBenefitManagers
Daily Mail
a day ago
- Business
- Daily Mail
Widespread texts from CVS announcing closures cause panic in state
By Louisiana residents were left confused — and a little panicked — after CVS sent out ominous texts claiming the pharmacy giant may shut down every store in the state. The messages, sent directly to customers' phones this morning, warned that 'your medication cost may go up and your pharmacist could lose their job' — sparking a wave of concern and confusion. The alert was linked to House Bill 358, a new piece of legislation targeting Pharmacy Benefit Managers (PBMs) — the behind-the-scenes middlemen that help set drug prices and reimbursement rates. CVS, which owns one of the nation's largest PBMs, Caremark, says the bill could force it to pull out of Louisiana entirely. 'If you choose to be a PBM, you can still be a PBM,' explained State Rep. Dustin Miller (pictured), who sponsored the bill. 'But you cannot be a PBM and a pharmacy.' Lawmakers argue the measure is designed to stop big chains from steering customers toward their own stores — a move they say hurts independent pharmacies and inflates prices. The text blast from CVS — which has revamped management after a sales slump — didn't go over well with many legislators. 'Scare tactics,' said Rep. Dixon McMakin (pictured), who slammed the company's messaging as misleading. Others, like Rep. Edmond Jordan, tried to calm nerves: 'Independent pharmacies aren't going to close tomorrow. In fact, they're doing better than they have in years. If CVS decides to leave, hopefully, we have people there to make up that difference.' PBMs are used by pharmacies, insurance companies, and drug manufacturers when setting drug prices. 'They set the rates and the reimbursement for the pharmacies; we are just telling them if that is your core responsibility, you can keep that as your core responsibility,' Miller said. 'We don't want you to also go open a pharmacy and steer people to you and compete against other pharmacies.' The text message fiasco comes after Arkansas signed Act 624 into a law banning PBMs from owning or operating pharmacies starting next year. Reddit users were more blunt. 'CVS has one of the biggest PBM's and they don't want to give up all the price fixing they do. Let them leave. They will come crawling back,' a customer claimed on a post. 'Just got it myself as well at the email. Do not respond. If they leave, they leave of their own volition because they don't truly care,' another person wrote. The bill, which has passed both the House and Senate, now awaits the signature of Governor Jeff Landry, who is expected to sign it into law. That is expected to be a formality. The text message fiasco comes after Arkansas signed Act 624 into a law banning PBMs from owning or operating pharmacies starting next year. CVS has been having financial problems over the last few years. The chain announced back in 2023 that it would close 900 stores by the end of 2024. The pharmacy chain revealed the closures were part of a 'retail footprint strategy' created in order to continue meeting customer needs. CVS is planning to shutter 270 stores this year, but will continue operating over 9,000 locations nationwide. It experienced a 7% increase in first quarter revenue compared to 2024 and has not filed for Chapter 11 bankruptcy protection. However, fellow pharmaceutical chain Rite Aid has been struggling to stay afloat after filing for bankruptcy in 2023. It's set to close 111 stores across the US this year, and is in the process of selling its pharmacy assets following its second bankruptcy filing has reached out to CVS for comment about the text messages.
Daily Mail
a day ago
- Business
- Daily Mail
Panic as entire state receives texts from CVS warning ALL pharmacies are on brink of closing
Louisiana residents were left confused — and a little panicked — after CVS sent out ominous texts claiming the pharmacy giant may shut down every store in the state. The messages, sent directly to customers' phones this morning, warned that 'your medication cost may go up and your pharmacist could lose their job' — sparking a wave of concern and confusion. The alert was linked to House Bill 358, a new piece of legislation targeting Pharmacy Benefit Managers (PBMs) — the behind-the-scenes middlemen that help set drug prices and reimbursement rates. CVS, which owns one of the nation's largest PBMs, Caremark, says the bill could force it to pull out of Louisiana entirely. 'If you choose to be a PBM, you can still be a PBM,' explained State Rep. Dustin Miller, who sponsored the bill. 'But you cannot be a PBM and a pharmacy.' Lawmakers argue the measure is designed to stop big chains from steering customers toward their own stores — a move they say hurts independent pharmacies and inflates prices. The text blast from CVS — which has revamped management after a sales slump — didn't go over well with many legislators. 'Scare tactics,' said Rep. Dixon McMakin, who slammed the company's messaging as misleading. Others, like Rep. Edmond Jordan, tried to calm nerves: 'Independent pharmacies aren't going to close tomorrow. In fact, they're doing better than they have in years.' 'If CVS decides to leave, hopefully, we have people there to make up that difference.' PBMs are used by pharmacies, insurance companies, and drug manufacturers when setting drug prices. 'They set the rates and the reimbursement for the pharmacies; we are just telling them if that is your core responsibility, you can keep that as your core responsibility,' Miller said. 'We don't want you to also go open a pharmacy and steer people to you and compete against other pharmacies.' The text message fiasco comes after Arkansas signed Act 624 into a law banning PBMs from owning or operating pharmacies starting next year. Reddit users were more blunt. 'CVS has one of the biggest PBM's and they don't want to give up all the price fixing they do. Let them leave. They will come crawling back,' a customer claimed on a post. Representatives Dustin Miller and Dixon McMakin gave their opinions on the House Bill on the House floor this week The closures would be the result of House Bill 358, which would require CVS Health to stop operating CVS Caremark and pharmacies that own PBMs in Louisiana. 'Just got it myself as well at the email. Do not respond. If they leave, they leave of their own volition because they don't truly care,' another person wrote. The bill, which has passed both the House and Senate, now awaits the signature of Governor Jeff Landry, who is expected to sign it into law. That is expected to be a formality. The text message fiasco comes after Arkansas signed Act 624 into a law banning PBMs from owning or operating pharmacies starting next year. CVS has been having financial problems over the last few years. The chain announced back in 2023 that it would close 900 stores by the end of 2024. The pharmacy chain revealed the closures were part of a 'retail footprint strategy' created in order to continue meeting customer needs. CVS is planning to shutter 270 stores this year, but will continue operating over 9,000 locations nationwide. It experienced a 7% increase in first quarter revenue compared to 2024 and has not filed for Chapter 11 bankruptcy protection. However, fellow pharmaceutical chain Rite Aid has been struggling to stay afloat after filing for bankruptcy in 2023. It's set to close 111 stores across the US this year, and is in the process of selling its pharmacy assets following its second bankruptcy filing.
Newsweek
27-05-2025
- Business
- Newsweek
All CVS Locations in One State at Risk Over PBM Law
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. CVS has told Newsweek that some of Arkansas' only 24-hour pharmacies are at-risk of closure because of new state law signed by Governor Sarah Huckabee Sanders last month. Reports over the weekend suggested the pharmacy giant was looking to close all 23 of its stores in the state, ahead of legislation which prevents drug middlemen, known as Pharmacy Benefit Managers (PBMs), from owning and operating pharmacies. "All of our 23 Arkansas stores are currently open and will continue to operate for the immediate future. We're doing everything we can to continue to provide pharmacy services to our 340,000+ Arkansas pharmacy patients," a CVS spokesperson said Tuesday morning. Why It Matters CVS said that passing Act 624, as the bill became known, puts the services available to its customers at risk. Those who advocated for the move said they wanted to protect independent pharmacies and stop patients from being abused. Stock image of a CVS Pharmacy seen in New York City on March 10, 2025. Image for illustration purposes only. Stock image of a CVS Pharmacy seen in New York City on March 10, 2025. Image for illustration purposes only. Sipa via AP Images What To Know Sanders said in April that PBMs "take advantage of lax regulations to abuse customers" as she made Arkansas the first state to ban drug giants from owning pharmacies. The governor and her Attorney General Tim Griffin said that PBMs had taken advantage of their position as price negotiators to benefit the pharmacies they owned and their shareholders, damaging independents in the process. CVS told Newsweek that there were 14 more independent pharmacies operating in the state than there were in 2019, and that CVS Caremark reimburses them at a higher rate than its own pharmacies—at 61 percent. The company said it believed Act 624 would shut pharmacies down and cut people off from health care once it comes into force January 1, 2026. PBMs are the middlemen between drug companies, insurers, and the pharmacies themselves, negotiating on the supplies and prices of medications, affecting how much providers and patients pay. One of the key issues with PBMs is a lack of transparency on how they operate, with no obligation for them to share details with insurance companies on the formulas they use to determine payment share. Per the Center for American Progress (CAP), CVS Health accounted for a third of the PBM market in 2022, with Cigna and UnitedHealth taking up the next largest chunks at 24 and 22 percent respectfully. Sanders and those in the Arkansas General Assembly who pushed for the law change in the state argue that these big companies do not lower costs and only benefit themselves, but CVS said it believed this reasoning was being used to enact a law which would only negatively impact customers. What People Are Saying A CVS spokesperson told Newsweek: "Facts should matter more than rhetoric, and a simple economic analysis could have avoided all this chaos…Small businesses, employers, health plans and others are going to have to pay more for prescription drugs starting next year because of this new law. "Proponents of the bill have consistently made misleading claims about the need and rationale for this legislation, while downplaying the devastating impact it will have on patient care." Governor Sarah Huckabee Sanders, in an April press release: "These massive corporations are attacking our state because we will be the first in the country to hold them accountable for their anticompetitive actions, but Arkansas has never been afraid to be a conservative leader for America." John Vinson, CEO of the Arkansas Pharmacists Association, in a press release in April: "This is a major victory for Arkansas patients, local pharmacies and the integrity of our health care system. If we want to protect patient choice, lower drug costs and support local businesses, then ending PBM ownership of pharmacies is essential." What's Next CVS said it is reviewing its options for its 23 pharmacies in Arkansas, which all remain open for now.
Yahoo
20-05-2025
- Health
- Yahoo
Trump drug order ignores the government's interest in high drug prices, Ohio expert says
Multiple Republican-led states have sued to rescind a federal rule keeping the records of those who sought legal reproductive care private, while a federal judge in Texas is questioning the constitutionality of the federal HIPAA law in its entirety. (Photo by) The issue of drug pricing has been as pressing in Ohio as anywhere. President Donald Trump last week issued an executive order requiring drugmakers to offer their products as cheaply here as they do overseas. But players in the industry say the order lacks detail about how it would make that happen. An Ohio expert said the order ignores the arcane, often self-serving way drug prices are inflated by myriad players in the United States — including the government itself. In Ohio, the cost of prescription drugs has been an issue of major contention the last several years, including lawsuits against drug middlemen known as Pharmacy Benefit Managers, who've been accused of vertical integration, inflating prices, and deterrence of competition. Trump last Monday issued his executive order, Delivering Most-Favored-Nation Drug Pricing to American Patients. The order notes that the United States has less than 5% of the world's population, yet Americans pay 'three quarters of global pharmaceutical profits.' It accuses drugmakers of unfairly billing Americans for research and development while agreeing to lower prices demanded by governments of other developed countries. 'Drug manufacturers, rather than seeking to equalize evident price discrimination, agree to other countries' demands for low prices, and simultaneously fight against the ability for public and private payers in the United States to negotiate the best prices for patients,' the order says. 'The inflated prices in the United States fuel global innovation while foreign health systems get a free ride.' The order instructs U.S. Health and Human Services Secretary Robert Kennedy Jr. within 30 days to 'communicate most-favored-nation price targets to pharmaceutical manufacturers…' Using that list, the government could import drugs selling more cheaply in other countries on a 'case-by-case' basis, the order says. However, there are about 20,000 different prescription drugs sold in the United States. The order doesn't explain how, in just a month, anyone can gather and analyze global pricing data and decide which countries are getting the best deal on each — much less set up and administer a 'case-by-case' system on such a scale. And there's the much bigger question of what Trump means by 'price.' That word can have many definitions in the inefficient health care system of the United States. There's the list price — the price you would have to pay if you don't have any insurance or other form of discount. But that's not the price that is typically paid. The drug middlemen known as pharmacy benefit managers, or PBMs, play a huge role in determining list and net prices in tens of millions of prescription drug transactions. The biggest three are part of giant health care conglomerates — UnitedHealth Group, CVS Health and Cigna-Express Scripts — that also own top-10 insurance companies. The big PBMs represent those insurers and other payers in prescription-drug transactions. SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX Two facts about the big PBMs are of great relevance to drug pricing: Combined, the big three handle almost 80% of the insured drug transactions. And they decide which drugs are covered by insurance, and which of those get the most favorable treatment — usually in the form of the lowest copayment. That enables them to get drugmakers to pay them big — and growing — rebates in exchange for favorable treatment. Drugmakers have been shown to increase list prices to cover the often-nontransparent rebates. 'Because rebates are based on list prices, PBMs are incentivized to prefer drugs with higher list prices, even when cheaper generics and biosimilars are available,' Emma Freer of the American Economic Liberties Project wrote in an MSNBC column Tuesday. For example, the Federal Trade Commission is suing the big PBMs over insulin practices it says benefitted both the PBMs and the three companies that manufacture almost all the insulin in the United States. It said the PBMs excluded cheaper drugs from coverage so it could chase bigger rebates from more-expensive alternatives. That would be a win-win for the drugmaker and the middleman. But it would be a big loser for the diabetic who has to make copayments based on inflated list prices, or who has to shoulder the full freight. While Trump's executive order accuses other countries of taking advantage of Americans, it's silent on rebates. The order is also silent on whether 'most-favored-nation pricing' would be enjoyed by all Americans, or just those covered by government programs like Medicare and Medicaid. Antonio Ciaccia, the Columbus, Ohio-based president of drug-pricing consultant 3 Axis Advisors, said the government also has a strong interest in high drug prices. That's because the federal government also gets huge amounts in drugmaker rebates. And that's money it can use to justify other spending, or tax cuts. For example, drugmakers are only allowed to pay rebates in Medicare because they're exempted from the federal anti-kickback statute. Trump in 2020 issued an executive order that would have greatly narrowed the exemption, but it went nowhere. Then, in 2022, an extension of anti-kickback exemptions under Medicare was slipped into an unrelated gun bill. Democrats and Republicans voted for the bill. Sen. Rob Portman, R-Ohio, gave a reason — the federal government stood to collect an estimated $180 billion in Medicare rebates over a decade. Allowing rebates might cost Americans and their government more over the long run, but as budgets are written, they're revenue that can be used for other things. In government circles, it's known as a 'pay-for.' In an email, Ciaccia said that giving government an incentive to chase rebates inflates drug prices and that works against Trump's stated priorities. 'The biggest lie in the drug supply chain is that government wants lower prices for medicines,' he said. 'What government actually wants is bigger discounts off the prices of medicines.' He added, 'When public policy is explicitly designed to inflate drug prices and then soak discounts off those prices to fund 'other' things, if you actually lower the prices, those 'other things' are in big trouble. This is why the U.S. government can't get enough of this addictive horse-trading of drug money for other priorities, which is why high prices reign supreme.' SUPPORT: YOU MAKE OUR WORK POSSIBLE
Yahoo
14-05-2025
- Politics
- Yahoo
Stitt, Drummond spark fireworks over vetoed bills
OKLAHOMA CITY (KFOR) – Recent vetoes by Governor Kevin Stitt at the Oklahoma Capitol have sparked a fiery exchange between the Governor and Attorney General Gentner Drummond. Stitt vetoed two bills that would have given the Attorney Generals' office more power. Senate Bill 773 was one of them. It allowed the AG's office the power to oversee investigations into how Pharmacy Benefit Managers (PBMs) price prescription drugs. Oklahoma lawmaker battling breast cancer 'stunned' after Stitt vetoes bill requiring insurance to cover cancer screenings 'This bill hands additional power to an Attorney General who has shown again and again that he will abuse it,' said Stitt. 'To date, he has used his office to sue agricultural farmers, tech companies and other Oklahoma businesses for political gain.' Stitt said giving the AG's office that kind of power with the bill would give Drummond the 'financial incentive to sue people.' Drummond responded to Stitt's comments. Gov. Stitt vetoes bill that would extend Oklahoma eviction timeline 'I cannot imagine a more sickening thing for a Governor to do than stand with PBMs and health insurance companies instead of fighting for the Oklahoma families routinely abused by these self-serving and greedy entities,' said Drummond. So far, Stitt has seen some backlash from several of his vetoes. Lawmakers at the Capitol have said they would consider an override, which would need two-thirds of the vote from both the House and Senate. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
