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Ohio MAC transparency law now in effect! Now what?
As mentioned previously, Governor John Kasich signed OPA-backed maximum allowable cost (MAC) pricing and pharmacy benefit manager (PBM) reforms (contained in HB 64) into law. These reforms will better enable pharmacies to be kept whole on the medications they purchase and dispense to patients.
While the law is now in effect, we expected the rollout to bring many questions and perhaps some foot-dragging by a few in the PBM industry, and as expected, it appears we're getting some of both. See below for a complete guide on the new law, implementation of the law, and what to do if you are working with a PBM who is failing to comply with the law.
What are the new laws?
OPA has created a special summary of the new provisions contained in HB 64 that will create some structure to MAC pricing, give greater transparency, and create a regulatory structure for PBMs. You can access that document here: Ohio Mac PBM Law Summary
To view the laws in their entirety, please review sections 3959.01, 3959.111, and 3959.12 of the Ohio Revised Code.
NOTE: In 2017, OPA was successful in improving and tightening the MAC pricing standards in SB 319. For more information on those improvements, click here.
How will the new laws be enforced?
One of the problems with some MAC laws that have passed in other states, is that they aren't being enforced, which is why OPA pushed hard for an enforcement component of the law.
While the law went into effect in September, we are just now able to share with you official guidance from the Ohio Department of Insurance (ODI) on how they expect to enforce the new law moving forward. Even though they have not had the chance to begin creating additional rules, OPA has been working with them for months on the ins and outs of the legislation, and making recommendations for fair, effective enforcement. For a complete rundown of ODI's expectations and some FAQs on the new law, please visit: http://insurance.ohio.gov/Agent/Pages/PBM.aspx
How do pharmacies register complaints if the law is not being followed?
We are pleased to report that it seems several PBMs seem to be embracing the spirit of the law so far, however we are hearing that not all PBMs are in compliance.
OPA has received many calls about generic drugs being paid way below cost. Due to the passage of HB 64, you now have a powerful tool to combat the below-cost reimbursement. If your PBM is using MAC to determine generic reimbursement, you have the right to follow the following steps to challenge the payments:
FIRST, contact the PBM to object to a price. Call the PBM involved, and lodge a formal complaint on the price. Under Ohio’s law where all PBMs are now regulated, they are to set up a procedure for you to appeal a price, and they must provide a specific phone number so that you can discuss the appeal. If you find that the PBM has not complied with the law (For a summary, click here) by setting up an appeals procedure, then call the Ohio Department of Insurance at 1-800-686-1526 and let them know that you have attempted to follow the law’s appeals procedure, but the PBM either has yet to create that process or has denied you the process altogether. Obviously, if the PBM has granted you the appeals process and is adhering to it, then follow it.
Next, if you appeal a MAC price, the PBM has 21 days to investigate and resolve your appeal.
If your appeal is accepted, the PBM must make an adjustment to your reimbursement that is retroactive to one day after the appeal was made. Additionally, the PBM is supposed to make that adjustment for all "similarly situated pharmacies."
If your appeal is denied, the PBM must provide the reason for the denial, and the identification of the NDC of the drug that you can purchase from a national or regional wholesaler at a price that is at or below the MAC benchmark that the PBM has in place.
If the PBM fails to adhere to the process, or if they fail to meet the provisions stated above, then call the Ohio Department of Insurance at 1-800-686-1526 and let them know that you have appealed to the PBM as prescribed by the law, but the PBM has failed to update the reimbursement sufficiently or has not pointed you toward a wholesaler that has the drug available at the going PBM MAC price.
Additionally, you have the right to obtain from a PBM, within 10 days of your request, a current list of the sources used by the PBM to determine their MAC pricing. If you are consistently seeing discrepancies between the MAC and what wholesalers have the medication priced at, it is important that you request these sources to ensure MACs are being updated weekly and are truly reflective of objective measures.
Important!
For all issues, please seek remediation with the PBM first. If there is no sufficient resolution, then notify ODI in a detailed, professional manner. If you are seeing pervasive or severe problems, please contact OPA Director of Government & Public Affairs Antonio Ciaccia at (614) 389-3236 or aciaccia@ohiopharmacists.org, and please let your legislator know.
Keep us in the loop on how all your interactions are going on this law's roll-out.
Thanks!
We would like to thank all of our members for assisting us in making this law a reality. Thanks to the Ohio Department of Insurance for working with us on the implementation. We would also like to thank Reps. Tim Brown and Jack Cera, who were ultmately successful in integrating maximum allowable cost (MAC) transparency language & these key pharmacy benefit manager (PBM) reforms from HB 127 into the Ohio Budget (HB 64).
While there are many legislators who are owed thanks, we'd like to especially recognize Reps. Ryan Smith (who ultimately agreed to add this language to HB 64 during his Finance Committee deliberations), Jack Cera, Ron Amstutz, Michael Stinziano, Jim Butler, Kirk Schuring, Dave Hall, Bob Hackett, Jim Buchy, Jeff McClain, Andy Thompson, Denise Driehaus, and Brian Hill; as well as Sens. Randy Gardner, Kevin Bacon, Bill Coley, Bill Beagle, Joe Uecker, Bob Peterson, Troy Balderson, Michael Skindell, Tom Patton, Dave Burke, Scott Oelslager, Lou Gentile, Joe Schiavoni, and President Keith Faber, for delving into the issue, refining language, and ultimately ushering the language through. We'd also like to thank House & Senate staffers Daniel James, Pam Wilson, Scott Partika, Lindsey Brigano, Steven Alexander, and Ben Webb. Special thanks also go to Speaker of the House Cliff Rosenberger for having an open ear, and engaging with OPA on this issue every step of the way. This would not have been possible without his leadership. And of course, thanks to Governor Kasich for taking this bold step to create transparency within the PBM industry, which benefits pharmacies, business owners, and patients.
There are too many people to thank to be honest. There were hundreds of pharmacists and student pharmacists who met, called, and emailed their legislators about this issue. There were district events, town halls, roundtables, and more. The outpour of support and action has been inspiring. The National Community Pharmacists Association and their state government affairs director Matt DiLoreto have been incredible assets. The buying groups were all major helps - American Pharmacy Services Corporation, Miami-Luken/REM Corp, Independent Pharmacy Cooperative, American Pharmacy Cooperative Inc. The small pharmacy chains like Discount Drug Mart, Ritzman's, Shriver's, Hometown Pharmacies, & Riesbeck's were all big players in this too. And as you might imagine, we can't even begin to name all of the independent pharmacists who pitched in. THANK YOU all of those members who helped carry the load on this legislation. This has been a true team effort.
Outside of the support of volunteers and members, and the work of OPA's legislative staff in building coalitions and meeting with legislators, supporting political campaigns is a huge part of the advocacy process. We need to support good legislators who support pharmacy and the patients we serve, and we need to build on these recent success by working towards even bigger goals. Please consider financial support of our legislative efforts by contributing to the OPA Pharmacy PAC. 100% of Pharmacy PAC money contributed by pharmacists goes to help candidates who support pharmacy in Ohio. Or if you'd like to make a corporate contribution to support OPA's investment in our advocacy program, please consider being a part of the OPA Legislative Defense Fund (LDF).
