The New Jersey Assembly Human Services Committee has advanced a measure requiring pharmacy benefit managers to disclose more of their financial information to the state’s Department of Human Services.
Under A-1259/S-249, a pharmacy benefits manager providing Medicaid services in New Jersey would need to disclose the “sources and amounts of” income and benefits they receive from managed care organizations. They would also need to reveal ingredient costs, the administrative fee model and dispensing fees or related payments to pharmacies.
Proponents say the measure will help the state understand if a pharmacy benefits manager uses spread pricing, a practice of charging more than the amount paid to a pharmacy on behalf of a managed care organization. Proponents point to studies from other states showing that banning spread pricing could save Medicaid programs upward of $43 million annually.
“By properly monitoring pharmacy benefit managers’ profits, their payment models and use of spread pricing, New Jersey will be better equipped to put a stop to practices that are costing taxpayers and Medicaid beneficiaries,” Assemblywoman BettyLou DeCroce, R-Morris, said in a news release.
“Everyone is negatively affected as the prices of prescription drugs rise,” DeCroce added. “For our lower income residents who forgo important medications to pay the bills to our taxpayers who are suffering under increased state spending, it’s time we reign in these runaway costs.”
The state Senate unanimously approved the bill in February 2020.
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