April 1, 2020
Visante was commissioned by the Pharmaceutical Care Management Association (PCMA) to estimate the potential cost impact of four types of state legislation impacting pharmacy benefit management (PBM) tools: PBM disclosure mandates, PBM fiduciary mandates, limits on prior authorization (PA) and step therapy (ST), and any willing specialty pharmacy requirements.
As a general rule, such state legislation would affect only plan sponsors for commercial, fully insured plans. These plans provide prescription drug benefits to an estimated 100 million Americans. To make our estimates, we conducted a comprehensive review of the published evidence on how much PBM tools save as they are currently used in the marketplace and created an economic model of the impact of legislative proposals on the use of these tools and the resulting impact on projected drug expenditures for the fully insured commercial market for the next 10 years.
Proposals to restrict the use of PBM tools limit options that plan sponsors can use to manage their drug benefit costs. Some legislation may prohibit the use of a PBM tool entirely, driving savings to zero. Other legislation may negatively affect the full use of PBM tools and compress the range of savings achieved in the marketplace. We modeled how the savings from those tools would be reduced and how projected drug expenditures might increase over the next 10 years as a result.