潘金莲传媒映画

A pharmacy benefits manager bill passed by the Mississippi House of Representatives last week may have little impact on drug costs in the state’s workers’ compensation system, even if that is part of the bill’s intent.

“The problem is, drug pricing is as hard to understand as quantum mechanics are to a fish,” said Joe Paduda, principal of Health Strategy Associates and a longtime consultant on workers’ comp medical costs.

That sentiment has not stopped lawmakers around the country from trying to crack the code on increasingly controversial pharmacy benefits managers, or PBMs. The firms have been employed mostly in health insurance to control drug costs but also are used in workers’ compensation insurance in many states, including Mississippi. Workers’ comp laws in most states generally require generic drugs for injured workers, but even those prices can vary, and generics are not always available, so PBMs are often employed.

Critics have charged that PBMs act as middlemen that inflate prices while squeezing independent pharmacies.

The Mississippi House last week voted 90-8 in favor of , sponsored by Rep. Jansen Owen and by Speaker Jason White. If passed by the Senate and signed into law, it would, according to the Associated Press and Mississippi Today news outlets, would:

• Prohibit PBMs from charging insurers more for drugs than pharmacists are paid, a practice that can be used by the companies to inflate their profits. But this spread pricing is one way that PBMs have made a profit, so it’s unclear if the restriction would effectively bar PBMs altogether.
• Require PBMs to submit reports detailing the rebates, or cost savings, they receive from pharmaceutical companies and to disclose their affiliations with pharmacies to the state Board of Pharmacy.
• Require drug manufacturers and health insurers to submit reports detailing wholesale drug costs and information about drug costs and spending to the Board of Pharmacy.

A similar measure, , is awaiting action in the Senate. It would effectively prohibit spread pricing by PBMs, except for those used by self-funded health plans, according to the sponsor’s summary of the bill.

The chairman of the Mississippi Workers’ Compensation Commission, Mark Formby, said Tuesday that the quick passage of the House bill caught him by surprise. He noted that the measures may have little impact on the comp industry in the state, except for the fact that they would likely require PBMs, drug makers and insurers to report to the Board of Pharmacy regularly, including when the wholesale acquisition cost of a medication increases significantly.

Paduda argued that linking reports to the wholesale drug price is ineffective because the wholesale price is often too fluid and can be easily manipulated by drug manufacturers. “Pharma companies will monkey around with the drug codes and the average wholesale price and game the system,” he said. “That happens all the time now.”

A better approach would be one that dictates actual prices on drugs used to treat various conditions, Paduda argued. A few states have tried that idea.

Some 12 states have taken another route: establishing complex drug formularies for workers’ compensation and, in some cases, for no-fault auto insurance. Formularies, which develop lists of medications that do not require prior approval by the insurer, have been seen as effective in reducing costs.

Mississippi has a workers’ comp medical fee schedule for services, but has not adopted a drug formulary.

Injured workers in the state could be affected if independent, smaller pharmacies close down in coming years. Many Mississippi independent pharmacists as a result of low payments from pharmacy benefit managers, which small businesses do not have the leverage to negotiate, the Associated Press reported.

“Collecting the data is one thing. Doing something with it is another,” said Robert Dozier, the executive director of the Mississippi Independent Pharmacy Association. “When you look at the legislation, it does nothing to help the pharmacists, and it’s not tightening the loopholes that the Board of Pharmacy needs. It’s not going to do a whole lot.”

The Associated Press contributed to this report.

Top photo: AI-generated image from Adobe Stock images.

Topics Workers' Compensation Mississippi