Have you heard of food desserts?
In the same poor urban and rural areas of the state, there are “pharmacy deserts” and they are becoming more common as independent pharmacies go bankrupt.
According to New York Assembly member John McDonald, longtime owner of Marra Pharmacy in Cohoes, the reason pharmacies go bankrupt is due to the actions of Pharmacy Benefit Managers (PBMs).
“Here in my district alone, from South Albany to Cohoes, four pharmacies have left in the past two years,” McDonald said. Capital tonight. “And I can tell you why: it’s because of the repayment which is illogical and unsustainable.
The main source of income for a pharmacy is from prescriptions, but an intermediary called the Pharmacy Benefit Manager, or PBM, reduces that income. PBMs are responsible for reimbursing pharmacies for the cost of the drugs they dispense; but often the reimbursement does not cover the cost of the drug.
McDonald’s said PBMs have profited at the expense of independent pharmacies.
“Between what they charge at the pharmacy and what they charge at the health plan, there is a delta, typically $ 6 to $ 7 per prescription,” he said. “So the PBMs use us for their own profits”,
Two bills that were passed by both houses of the state legislature in the last session could end this practice if Governor Kathy Hochul enacts them.
The PBM Transparency Bill will authorize and regulate pharmaceutical benefit managers. The Pharmacy Pass-Through Bill would standardize reimbursement for managed care plans that contract with PBMs.
Capital tonight received an email response to McDonald’s allegations from Greg Lopes, assistant vice president of strategic communications for the Pharmaceutical Care Management Association (PCMA), which represents PBMs.
“The accusations that PBMs are forcing store closures are unproductive and not based on fact,” the response reads. “There are more independent pharmacies today than five and 10 years ago. In New York in particular, the number of independent pharmacies in New York increased by 25% between 2011 and 2021, while the number of chain pharmacies in New York City declined 14% between 2011 and 2021.
Assembly member McDonald claims the association is faking the numbers.
“A lot of people know that pharmacies now have their retail pharmacy and their long-term care pharmacy, which fall under the same category,” McDonald said. “In addition, there are many pharmacies that do not deal with PBMs because of their practices. “
Additionally, out-of-state pharmacies and small wholesalers register as pharmacies, but they do not serve the same communities as independent pharmacies.
“Come visit me in Arbor Hill. Get off in downtown Troy. There are no pharmacies there, ”McDonald said of two low income areas. “The reality is [PCMA] can play with the numbers as much as they want, but we are unable to serve the people who need it.
The Business Council of New York State also released a statement on Tuesday against the legislation that McDonald’s supports.
“The legislation backed by the independent pharmacy lobby … will cost New York patients and health plan sponsors $ 28 billion in increased prescription drug costs,” according to Lev Ginsburg of the Business Council of New York State.
Again, Assembly Member McDonald contends that the assertion is incorrect.
“This is totally inaccurate,” McDonald said. “I work with the Business Council. I am a member, and the PCMA is also a member. This is a very fallacious argument. Maybe there is a $ 100 million hit on the transmission, but quite frankly, that could be addressed with another piece of legislation, if the governor wants to fix it. “
The Business Council statement continues.
“Given the extraordinary financial impacts caused by the pandemic, it would be irresponsible to adopt policies that would further increase the costs of health care for those in need,” he said.