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Greg Reybold, General Counsel at APCI, discusses the challenges independent pharmacies face with PBM abuses, recent federal legislation efforts like the Pharmacists Fight Back Act (H.R. 9096), and the growing advocacy efforts to bring real reform. He highlights APCI's role in shaping smart policies for community pharmacies.
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This transcript was generated automatically. Its accuracy may vary.
Mike Koelzer, Host 9/11: Greg, introduce yourself to our listeners.
Greg Reybold: Greg Reybold, general counsel and vice president of healthcare policy for American Pharmacy Cooperative or APCI.
Mike Koelzer, Host 9/11: Greg, I don't usually start off one of these conversations with one word, but here it goes. Ready?
Greg Reybold: Ready.
Mike Koelzer, Host 9/11: Well,
Greg Reybold: Well, look, it has been a busy time. It has been an exciting time in a lot of ways. For I would say the last year and a half, we've seen a proliferation of PBM and drug pricing bills at the federal level, like we've really never seen before. That's a credit to years of work and years of pharmacists advocating for fly-ins and educating their Congress people.
So in a way It's sort of this really exciting time because hey, a lot of attention on the issue, lot of legislation, and I think folks feel good about that, But when you drill down into the details from a community pharmacy perspective, an independent pharmacy perspective, and this is so important because, independent pharmacy was like the OG in sounding the alarm.
for PBM abuses and PBM practices. Independent pharmacists saw it. They were the first to see it, identify the problems as to patients as to payers, as to, their business models as well. And they were the ones to sound those alarms. And if you look at the overwhelming majority of the legislation that's out there, it doesn't do a whole lot to really address the roots of the problem.
And so while it's an exciting time, it's been a really frustrating time as well. And then you add on to the fact that the pharmacists that are in their pharmacy caring for their patients working long days with their heads down, boy, it's been a tough year, right? I mean, it's been a tough several years.
And so Yeah We were thrilled to see the introduction of Pharmacists Fight Back Act H. R. 1996 by Congressman Auchincloss and Congresswoman Harshberger. We think it is far and away the most comprehensive piece of legislation to actually address the problems themselves and get to the root of those problems.
Mike Koelzer, Host 9/11: As pharmacy owners, I think we're smart enough to know that, when you see a lot of stuff happening, I think we've learned enough not to get excited. I've had too many times where. You're excited.
And then like the next day, it's like, they act like they've never talked to you before. the PBM mafia got to them, or else, in Michigan, we had this bill, you read the first draft and then the next draft comes out. And it's like, is this the same? Same page, then you get excited. you see the Congress and you see Washington and you're actually in the house of representatives, the meetings and stuff, it's a lot of excitement, but it hasn't intertwined yet with who needs it.
Greg Reybold: It hasn't, right? I mean, there is some legislation out there that I think in certain ways is very good, right? A lower cost, more transparency, which passed out of the House, has meaningful Medicaid managed care reforms that were espoused by pharmacist and congressman Buddy Carter, right?
So there's provisions for lower cost, more transparency that We like a lot. There's some interesting things that Senate Finance has done that we're certainly supportive of. But in terms of keeping doors open and reigning in the most abusive PBM practices, there's very little that does it, right?
And so, look, we're on the back end of a biennial, right? The legislative session is coming to a close on December 31st, right? but every now and then the stars seem to align at least a little bit. And so you had a blockbuster, and I may get the order of this wrong, but you had, I think, a really, a blockbuster Wall Street Journal article that really highlighted some of the findings of the most recent three axis report.
Eye opening, stunning stuff, right?
Which just really, got a lot of attention. And obviously, Wall Street Journal, kind of a conservative leaning, paper. Very shortly after that, what you have is the New York Times comes out with a powerful article. And then you get the FTC interim report, which
Mike Koelzer, Host 9/11: Perfect storm in a good
Greg Reybold: Right.
Perfect storm. And a long time community pharmacy supporter and an advocate and champion for PBM reform, Comer, has the oversight hearing and Pharmacists Fight Back Act gets introduced that day. Congressman Auchincloss, really has an opportunity to dress down one of the PBM execs and kind of hit him in the face with their own data.
And we're off to the races, right? And all of a sudden pharmacists have. the most comprehensive piece of PBM reform legislation that's ever been introduced at the federal level, far and away, the most comprehensive PBM reform legislation. For years, in various circles, there's sort of this feeling that reimbursement is a dirty word, right?
It's not okay to talk about the business of pharmacy. It's okay to talk about patients.
It's okay to talk about access. It's okay to talk about steering. But Reimbursement is somehow a dirty word.
Mike Koelzer, Host 9/11: my podcast is underground.
Greg Reybold: Yeah.
Mike Koelzer, Host 9/11: We're on the dark web
Greg Reybold: That's right.
Mike Koelzer, Host 9/11: stuff.
Greg Reybold: But, and you know what, Mike you're one of the, you're one of the few that's willing to go out there and actually have these hard conversations, because they're not easy conversations.
Most pharmacists got into the business because they're, you know, they want to care for people. And it's not comfortable to always have reimbursement talks. But the reality is, if we don't fix the reimbursement model, they're not going to be around to care for people, right? I mean, I feel like at least that's the trajectory.
I don't want to be too bombastic.
But that's what it feels like. And what I think this legislation has proven, and I hope it's shifting the landscape, because it's proof of concept. The bill's been introduced in July, and here we are in September, so, a little over a month.
It's got about 14, 15 co sponsors. Chairman of Oversight, Comer's a co sponsor, There is an appetite to substantively reform problematic PBM practices in a meaningful way and also to address reimbursement problems for independent pharmacies as well as patient facing abuses as well.
Mike Koelzer, Host 9/11: This summer we're at, we rented a cottage up in Empire, Michigan. It's kind of a city a few hours from Grand Rapids. And They have all these old books on the shelf, and these old rentals, there's games of Parcheesi and, cribbage boards and things
Greg Reybold: Yahtzee.
Mike Koelzer, Host 9/11: Yes. And there was this: they had all these old books there and my son, who's a grad teacher and high school teacher.
I'm looking at all the books and I said I never read this stuff. I said, I don't even know where I would start with things like Moby Dick and all those. I said, they've got to be old. Onerous, they're long and It's not the current, Who's, what's his name?
Greg Reybold: Yeah, James Patterson.
Mike Koelzer, Host 9/11: these quick, James Patterson, all these quick books. So, I go to the shelf and here, I don't know anything about old literature and I say, It was the best of times, it was the worst of times. I got this book in my hand, I'm picking it up like an orator. I open up the book, the first phrase of the first chapter, it was the
best of times, it. was the worst of times.
That's the only thing I know, Tale of Two Cities. I had no clue. You know what that was. It just makes me think though. It's like here, Greg, and I know you don't, you've always been so honest with us as the hosts and listeners, I've been so honest. And that's why I have you keep coming back to the program. The best of times, I don't know, I don't know what the hell that meant, but I'm going to make it my own phrase. The best of times we've never seen anything like it, but it's not changing a penny, in the, might even change
Greg Reybold: Yeah.
Mike Koelzer, Host 9/11: And maybe I haven't had it, but maybe someone will slap you on the back.
If they see a big news story, my brothers might say, Hey, I saw that. That's pretty cool. The wall street journal, this and that, but it doesn't change a penny. That's, you know, unfortunately that's what, We all need. And so that's, that's the worst of times. That's the sad part about it.
Greg Reybold: Yeah, And I love the analogy. And I think I think you just hit the nail on the head, right? And listen, trying to think of a good way to say this, but You know, we're, we're at the beginning, we're not at the end, and, you know, certainly there's nothing on the horizon in the next month, the next two months, the next three months that necessarily will materially, you know, come, hey, there could be some lame duck package, we'd love to see some portion of 9096 included in a lame duck package. At this point, unlikely, right? Hasn't gone through the committee process, or the other pieces of legislation have. But I think, from my perspective, you know, Pharmacy needs to be past the hollow victories. Now that doesn't mean you don't enjoy moments, right? And you've got to, and I tell my kids that too, right? There's no finish line to things, and you have to enjoy the small victories, and you have to savor those. But here's the thing, I am not interested in seeing community pharmacy pass, you know, some piece of legislation that doesn't tangibly change things and doesn't rein in practices. And hollow victories, right?
So, To your point, yes, it's an amazing time, and that there's, people know what PBMs are, and by God, they know that they're manipulating drug prices to the detriment of patients, pharmacies, taxpayers, employers, name it. But the solutions that are being proposed at the federal level, by and are barely a band aid.
And that's not to say we're not grateful for the attention, because the truth is, you know, these representatives, these senators, they could be introducing legislation about anything. banking, farming, you know, aerospace engineering, and they're taking the time to try to rein in PBM practices. What's important is we have to fight the right fights. And I always, you talk about being honest, you know, one of them I sort of, when you get philosophical, I remember in 2017 when I was in Georgia and we, Georgia Pharmacy Association, and we passed the first in the nation Pharmacy Patient Protection Act. And up to that point, You know, states had passed some audit laws, some licensing laws, maybe a little MAC pricing, but this Bill came in and it said, hey, PBM, you can't do A, B, C, D, E, F, and G. And man, it felt good, right? It felt, it felt good. And I remember the magazine, you know, we worked on it. It went out and it said something like Georgia tames the beast. And everybody thought, hey, this is, we won. And of course, lo and behold, we didn't, right? There were massive enforcement issues, which remained throughout the country.
And so there's no finish line to this fight, but. It's also important to have some context. And the truth is When you look at it, pharmacies have scored some really, really significant victories because, and I say this a lot, hopefully I haven't said this to you before, but it's hard to pass a bill anywhere.
And pharmacy has proven capable to pass bills in state after state after state. There's work to do on enforcement, but there have been victories, right? There are states now in Medicaid, whether it's a carve out or whether it's through an enhanced dispensing fee, where States are paying pharmacies a fair dispensing fee, right?
Fair as being relative, but, but something in line with whatever the state Medicaid fee for service is.
Hey, that's keeping some stores in business in heavy Medicaid managed care areas, right? So the advocacy paid off there. You've seen Kentucky had just a killer year this year. And, and by the way, the work that Kentucky, um, you know, the independent group and the state association, the work that they did on that bill.
is inspiring. And you know what? They're doing it again on H. R. 9096. They have done amazing work advocating for that bill. And so, it's important to remember that pharmacy has made great strides when you look at what laws are on the books at the state level in 2014 and then you fast forward to 2024.
Great strides. Still massive work to do. And at the federal level, we can all remember going up to D. and nobody knew what a PBM was. so, we're in a different environment now. But, you know, tired of hollow victories, right? Let's fix this stuff. Let's cut off the legs that they stand on, you know, to funnel billions of dollars into their coffers at the expense of patients, taxpayers, pharmacies.
Mike Koelzer, Host 9/11: one of the things that. Some of my guests, and we do this too as a pharmacy, a smaller pharmacy independent, that you know, we can spin on a dime. We can care for the customer on a dime. We're not the Titanic and we can turn things around.
Unfortunately, we can also go out of business on a dime. talk to people that are like a month or two away from closing some of them. And some of these bills, they're. A lot of good news for some, I mean, sometimes things get broken up overnight, monopolies and stuff. But a lot of these things are good
news for the auto industry, because that means that in 2050 that, this, I'm going to be dead
Greg Reybold: yeah,
Mike Koelzer, Host 9/11: So you hear this stuff and it just Doesn't go as quick for speaking about speed though, Greg. All right. So this perfect storm comes that we talked about, the New York times and
the, uh, are the ones you mentioned the New York times, wall street journal
Greg Reybold: FTC, interim report.
Mike Koelzer, Host 9/11: kind of thing was this bill. Which came like, because here's the thing, Greg, I felt bad because I had, The, three of these guys on
Greg Reybold: great episode.
Mike Koelzer, Host 9/11: and Luke on, I had him on to talk about the FTC new letter that came out. I realized after the show was done, I'm like, Oh, I turned this into a. Congressional thing, because that news came out like four days after the FTC did, and I'm like, I want Greg on here too, if we're talking about congressional stuff. so the question is how quickly was that by chance that the congressional bill was just sitting there ready to
be, you know, to be like brought in, or can't imagine it was built within
like that week after hearing that perfect storm of those things.
Greg Reybold: No, look, you know, and you're right. I mean, this is a piece of legislation that had been, uh, worked on for, for some time. And, but, sometimes the stars align
Mike Koelzer, Host 9/11: and stuff. I mean, those are planned well in advance, unless you're having something like an assassination thing, but the other stuff is planned in advance.
So this was four part
perfect storm basically, or more.
Greg Reybold: Yeah, that's right. That's right. And, and obviously, you know, as we saw those, you know, those things happening, the thought is, oh wow, the timing couldn't be better. But was it, you know, planned to a T? No. What's the old saying? Better to be lucky than good, Right. So,
Mike Koelzer, Host 9/11: so. This bill, I know that you played a part in it. How does that happen? Is it from your popularity and people, knowing you're an honest, good fighter and things like that, that they call you up? How do you get involved the federal
bill?
And now that I'm asking it. You know, federal congressional people, they all represent a district. Maybe they pull people up from their district, but how does that come
about then?
Greg Reybold: Yeah, so I'd like to say it's really based on looks
Mike Koelzer, Host 9/11: I already told you that you and Antonio were going to be the, the body guards and those guys are slick looking, man, I have a face for radio. So I'm not going to put you in that category.
Greg Reybold: but listen, right, we, we try to be, you know, very policy minded stakeholders and, you know, we try to, you know, push, push out policy solutions and, and share research and, be you know, Good stakeholders in that regard and be looked at frankly as subject matter experts, and I think in a lot of ways It's easy to look at community pharmacy and say Oh, hey, you are Main Street businesses, you know, maybe not the most sophisticated policy.
But I think when you look at the history and the arc, again, Independent Pharmacy was out front on this before everybody else was. And, you know, one of the things we've been saying is, yeah, Independent Pharmacy, Mainstreet, Mainstreet sensibilities, but applied to policy. And, and I I think Independent Pharmacy has that, right?
We have got the solutions that can fix these problems. And frankly, as complicated as it may feel when every time you look under a new rock, you see a new game, they don't have to be that complicated. So we try to engage, we try to be good stakeholders, throughout the country, at the state level.
at the federal level. And one of the things I'd say, You know, particularly about Congressman Auchincloss is, he's very, you know, You know, very deliberate in engaging with, with, you know, different stakeholders with different views and really doing, you know, really doing a deep dive into, into what is driving drug prices and what are the issues with vertical integration?
Are there issues with vertical integration? And he's very deliberate in that regard. And so we ended up, you know, really, I think just developing a relationship based on, you know, discussions about, Hey, what is. You know, what is going on in this industry? And of course it evolved from there. Yeah,
Mike Koelzer, Host 9/11: foray into that was his constituents, you know, maybe maybe a, local pharmacist saying something, cause it's kind of a hard thing to take an interest in because as soon as you talk to someone for like a half hour, your eyes are rolling back and you're like, ah, I shouldn't have asked, you know? so how does he
go from learning about it to then wanting to do something about it?
Greg Reybold: he may be better to answer some of those questions, but, but, you know, certainly there really engaged independent pharmacists in Massachusetts. And so that, that very well, that very well could have been, I'd also say like Congressman Carter's office has done an amazing job wanting to be bipartisan and, you know, educating, you know, different, different, you know, members of Congress on issues, and he had co sponsored some legislation with Congressman Carter as well. But in terms of like the, the level of, of knowledge, and I don't, I don't know if I should share this or not, but the first conversation I ever had with him, uh, I was taking my kids to Pigeon Forge, you know, near Gatlinburg, Tennessee, about a three hour drive. and we were going to an indoor waterpark and so, you know, we ended up hitting traffic and so we didn't get there in time and, and, you know, I was planning on having a conversation with Congressman Laus.
So we get where we get to within like, eyesight of where we're staying after being in the car, probably anywhere from three to four hours. And the cell reception is spotty. And so I pull over and I say, Hey kids, don't worry. This will take, you know, probably 10 minutes. Be quiet, say a word, no sneezing, no laughing, you know, you little punks, right? So, listen, in DC, percent of the time you're talking with, you know, anybody who goes up there, you're talking with staffers, right? It's very rare that you're having that conversation because, again, they're being pulled in a million different directions. Well, this is him, you know, that, you know, the first call and it's Congressman Auchincloss, and we were on the phone for over an hour. and my kids the whole time are staring at the water park, and they have to sit still, and they have to be quiet, and we're just having a discussion, it was, it was eye opening because the questions he was asking Mike were smart, smart questions.
And they were, you know, critical. He was, you know, scrutinizing these things closely. and, and not with any preconceived notions, the questions he asks in hearings. He is one of the foremost subject matter experts on PBMs in Congress today.
Mike Koelzer, Host 9/11: I'm a
big fan of question askers, you know, I mean, cause it's
like to ask the right questions,
Greg Reybold: Yeah.
Mike Koelzer, Host 9/11: Well, even with AI now, I mean, there's professions that are popping up of saying, well, we know AI is going to give us answers, but you gotta put the right format and the right questions of things.
There's the people that are even learning how to do that. Well, Greg I think I've. Maybe I looked at a shortened version of it. How many pages
Is it something like that? And how does that compare to bigger bills?
The ones that nobody reads.
Greg Reybold: Yeah. You know, so, so, and it's really interesting, right? Because this bill is not, not the biggest bill, right? I mean, it's about 13 pages, maybe 12 and if you look at some of these other PBM bills out there, they shoot maybe 30 pages, 50 pages, 60 pages. And so, you know, in a way it's, it's short and sweet for sure, right?
But it gets to the point and it's more comprehensive from a reining in problematic PBM practices than, than anything else that's out there.
Mike Koelzer, Host 9/11: I mentioned my son, who's an English person. We always joke because, you can always quote people and no one knows who the hell, if they really said it or not, but we
Greg Reybold: Yeah, that's right.
Mike Koelzer, Host 9/11: Like, I believe it was the great Mark Twain who said this, but it was someone like Mark Twain who said, um, have me do an hour 's speech. no problem. Make me give a 10 minute speech. And you know, that takes
Greg Reybold: Yes, sir.
Mike Koelzer, Host 9/11: of planning, that bill, you can almost have a one pager, you know, tell the PBMs to stop screwing us,
that kind of thing. But I know it has to have substance, but sometimes the shorter ones are like Hey, this is simple. This is 16 pages. We're not, you know, that's the answer for us.
Greg Reybold: Yeah, and I think when you look at a lot of the bills out there, and it's like transparency reporting, and people are trying to be thorough, and so it's page after page after page of, you have to report this, but also this, and then you have to report this, and this, and this, and it can get so complicated, and what this bill really does in essence is say, hey, PBM, You can't do this, right?
You can't manipulate drug prices. You can't steer patients. You can't force patients to get more expensive brand name drugs when there's cheaper generics. If you're gonna negotiate discounts, here's a crazy concept. Stop charging patients fake prices, right? And it just says stop doing those things. And, there you go, right? I always, this is a movie that probably you've never heard of. You: But it always sticks in my mind in the policy world. It was a Disney movie. It was about the first time I saw an eye dog. And, you know, the guy was a boxer, he got hit, goes blind, has the seeing eye dog. I think the name of the movie was Love Will Lead the Way, I think it was the name of the movie. and the whole thing is, this guy's trying to get this dog licensed somewhere in California. You know, it's a novel thing. And years go by. And he's fighting this fight. He becomes an advocate. And ultimately, I'm probably, you know, just messing it up. But ultimately, at the end of the movie, they say, Okay, if your dog can get you through this obstacle course, Then we're going to license him as the first seeing eye dog in the city or the state and it's a tearjerker And I and I still remember this because it was one of my older cousins that I was watching it with And I like idolized him and like I see like there's like a tear running down his eyes Oh my god, like it was a point.
Yeah, it's just very rare. He's older big strong guy But so it's a tearjerker movie because the dog's got you know, it's arthritic. He's probably close to blind himself. He's old You And they set up this just unbelievably elaborate, basically, obstacle course in a gym. And the dog, looks at it for a minute, and he takes the owner around the whole obstacle course.
The dog was smart enough to know he couldn't take the owner through it. he went around it, right? And, and we live in like the table that the PBM set. And it's so easy to play that whack a mole game. And to say, right, and to get caught up in every little detail and look here but not here. And so I always think good policy cuts through all of the complications and all of the bull And just says, Hey, don't do it.
Right? Or just, just get to the root of it. Get to the heart of it. And I think that that's what this bill does. I think that's why it's resonating as much as it is with independent pharmacy, but also, you know, with, with, with patients as well.
Mike Koelzer, Host 9/11: Greg, what? is the quickest way that something could change. For example, I always think that it's something like if our state. said, starting tomorrow, these companies, I know they wouldn't do it, but starting tomorrow, this law says these companies have to be in Michigan or something like that, There's FTC things. There's congressional things. What other laws are there? There's permits, there's.
there's all kinds of ways you can sort of push people in a certain direction What would be the
quickest thing? Like what would be something that you said, okay, we got
this. It takes so long, but what could be
something that says, Hey, we got this. And
guess what? It's going to change next week.
Greg Reybold: I don't know that there's that one magic bullet, right? But what I would say is, you know, the size, the federal government is a Massive payer. Mike. Massive payer. You know, when you look at, obviously, You've got Medicare Part D. You've got Medicare Advantage. You've got Medicaid Managed Care, which is 77 percent federal dollars. Don't quote me exactly on that. You've got the Federal Employee Health Benefit Program, which I think is the largest self funded program in the United States. in the nation. And then you have TRICARE. And you know, and there's some others still, right? And so massive, massive. and so if, if Congress were to act and enact, you know, in total or provisions that are in 9096, again, there's not a long ramp up implementation period.
This isn't something where there's reporting that's going to happen in 12 months or 24 months and 36 months. And hey, you know, federal agencies go promulgate a book of regulations. It's PBMs, Stop doing these things in federal plans. so, you know, if Congress were to include that in some sort of a package or act on the legislation as stand alone in, you know, 2024, 2025, whenever, whenever that is, that would go a long way, long to, to stopping that, right? We've seen states act comprehensively. Some of their provisions have been really effective. Some haven't. Obviously, when you get to the state level, there's all sorts of preemption arguments. And I think that the state regulators usually should have the upper hand in light of PCMA v. Rutledge, right?
Which found cost regulations that aren't central to plan design. There's no preemption. But, but, hey, listen, they're not going quietly into the good night on that, right? They're litigating those points. There's a split in the circuits. So, but, the federal government comes in and takes sort of that sweeping action that just says, hey, no, right?
They take the pen out of their hand. You're not going to be setting drug prices anymore. You've lost that privilege. And when you think about this, when you put it in context, ultimately PBMs are government contractors or subcontractors for these federal plans. And they're utilizing their position as a government contractor or subcontractor to, I would posit, essentially fix prices.
Right? And rig it so that it is not a free market. And so that, you know, they can have variable pricing, they can manipulate the price, they can steer the most profitable drugs into their channels, they can target the sickest patients and fragment their care. And I think that enough has come out when you look at the three axis studies, look at the MedPAC reports, OIG, Government Accountability Office, now the FTC.
Right? There is enough out there to say PBMs, you have lost your privilege. You have lost the public trust when it comes to setting drug prices and leveraging vertical integration to steer patients into your channels. So you're not setting prices, you're not creating networks, and you're not steering. Enough is enough.
is enough.
Mike Koelzer, Host 9/11: Well, first of all, if you're paying somebody, know, if you don't want your kid to drive a car and you're paying
Greg Reybold: Yeah.
Mike Koelzer, Host 9/11: you take his keys away. And that happens like right when it happens. So I imagine that payment thing could stop like tomorrow, if somebody wanted to, we're no longer going to pay you for doing this.
I imagine that's quicker than if the FTC or
Greg Reybold: yeah.
Mike Koelzer, Host 9/11: said no oligopolies of the PBMs. That you know, that's powerful, but it doesn't stop a payment. still are writing checks back and forth. So I imagine following the money, who's paying whom. You could stop that as early as tomorrow.
If you want it to, they don't do that for various reasons. Even if they thought it was a great idea, they're going to give some time, but that's probably where the, that's probably the answer to that question. Things will happen the soonest with that, Because if they're just breaking the law, that's not going to happen soon unless you say someone's going to jail tomorrow if they do this.
So it's probably who's paying, that's probably the quickest way to do something.
Greg Reybold: yeah, and the federal government is a massive payer, right? But, but unfortunately, I think, you know, it is going through congressional action. so many of the really bad practices and I don't want to be, you know, I don't want to be sweeping and too hard, so many of the really egregious practices of PBMs and federal plans, the road has been paved by the agencies, that really should watching and overseeing a term that is very real concept, regulatory capture, agency capture. And, one of the things that the PBMs have done, just a marvelous job of, is leveraging their relationships with regulators and agencies, and really in certain ways, you know, getting them to regulate and open the door for really, really problematic practices.
You got, got one minute for digression
Mike Koelzer, Host 9/11: Absolutely. That's what we're all
about.
Greg Reybold: So,
Mike Koelzer, Host 9/11: Greg, I don't digress on this show. You know
Greg Reybold: Yeah, the year was 1903. No, a joke, but so, so listen, you know, Congress, and don't quote me verbatim on this, but, but Congress basically comes in, you know, in, in, in the federal code.
in regard to Part D
and they essentially say, hey, beneficiaries are going to get the benefit of the negotiated price.
Prescription drug plans are going to negotiate prices and beneficiaries are going to get that benefit. I'm going to get the year wrong. I think it's somewhere between 2013 and 2015. CMS is promulgating definition or updated definition of negotiated price. And what do they do in that definition?
After stakeholder input, meaning prescription drug plans, insurance companies, PBMs, they have, they come up with an exception. And the exception is essentially negotiated price is all discounts except those that can't, that can't be reasonably determined at the point of sale. Okay, CMS's definition of negotiated price.
And lo and behold, what do you think happens, Mike? Year after year after year, DIR fees grow, you know, and what happens is they go to pharmacies and they negotiate And it's sick when you think essentially, they negotiate discounts with pharmacies in a way that they can say they couldn't be reasonably determined at the point of sale.
And so they deprive the beneficiary, America's seniors of the discounts that they've negotiated with pharmacies. Now listen, you know, pharmacy for years advocated, you know, for DIR reform. And the story that an independent pharmacy told us, hey, they're, they're taking our money. Right? They're taking the money that they paid us.
And it's true. But what was also true is the independent pharmacies unfortunately were the patsies because they were overpaying the pharmacies at the counter on purpose so that they could take it back later and deny those to the seniors. And same thing with with drug manufacturer rebates, Because that's also DIR. And so in a 2023 report, they looked at D. A. R. and I think the year was for 2021 and they found about 12 billion pharmacies D. A. R. and about 50 billion in in drug manufacturer DAR, right? So you're talking about, you know, roughly 62 billion dollars in discounts that they negotiated that they didn't pass to seniors despite the congressional intent, right?
And the whole thing that enabled that is the agencies. And so while, you know, sometimes agencies, you know, take positive actions too, and I'm not going to say that CMS, you know, hasn't taken steps to try to rein in certain practices, but there, there is an issue at the federal level and in state departments, you know, community health departments, et cetera, there are real issues of regulatory capture.
And it's not malicious on the part of the agencies. They don't even know it, right? But they have paved the way. And so what I can tell you that I'm sure of is that the agencies aren't going to save the day.
Mike Koelzer, Host 9/11: Greg, break that one out for me. Give tell me that slowly that
about the. D
I
R, the seniors are not getting the
discount there,
and it's trying to keep
that money away from
Greg Reybold: Yeah,
Mike Koelzer, Host 9/11: Slow that one down a little
a bit.
Greg Reybold: Sure, sure. And what I would say is this.
You have to start from the premise of congressional intent, and if you kind of just a plain reading of the U. S. Code,
The beneficiary is supposed to get the benefits of the negotiated price. The discounts that are negotiated by prescription drug plans, a la their pharmacy managers beneficiary, are going to be America's seniors. And so what they did is they leveraged that loophole, right? So again, all discounts except those that can't be reasonably determined at the point of sale. You know, conceptually that's what the CMS reg did.
Mike Koelzer, Host 9/11: down. At the point of sale, they're saying, well, we're not there. How are you going to stand there
and you're going to bring a PBM in and talk with Mrs. Smith and the pharmacist and
work out a
deal? No, we can't do it there.
Just do this and we'll do it later.
Is that what you're talking
Greg Reybold: Yeah, yeah, that's right, right. So, but again, the patient gets the benefit of the negotiated price, but the negotiated price was defined by CMS to exclude discounts that can't be reasonably determined at the point of sale. I think CMS probably presumed good faith. If you read some of their public rulemaking comments, You could, they'll basically admit, hey this shocked the heck out of us.
We didn't see it coming. But what the prescription drug plans, the PBMs did is, they took that loophole and they negotiated incredibly complex reimbursement methodologies for pharmacies And rebate methodologies for drug manufacturers. And that enabled them to deprive beneficiaries of those negotiated discounts.
And that's, that's the crux of what they did. And here's where it gets, I think, just particularly gross. The PBMs and the prescription drug plans, they know really well that, you know, medication adherence is very much tied to the price of a drug. And there's, you know, replete data and studies that show, right, that the lower the cost, the better the adherence.
And then, of course, the better the adherence, the better the outcomes. And so, what PBMs did is, they negotiated these incredibly complex reimbursement methodology with pharmacies, tied them to Patient outcomes. metrics.
They deliberately drove the price for the patient up at the counter.
So the seniors are paying more under the auspices of improving patient outcomes. It's sick stuff, but, but they did it to the tune of billions of dollars. And so what DIR is, ultimately direct and indirect remuneration, what DIR Prescription drug plans and PBMs are reporting back to CMS are those discounts that weren't reasonably calculated at the point of. sale. Discounts that the patient didn't get the benefit of.
Mike Koelzer, Host 9/11: When I have an Antonio on, talking about all the different, he's saying that, um,
he's saying, I think he was quoting you, you guys just go in circles with each other. I'm just,
Greg Reybold: yeah.
Mike Koelzer, Host 9/11: So I think he was saying that you were saying, on a certain day there was, 80 different prices for the same drug at the same pharmacies, this or that, something like that. So. Let me see if I have this. So because that's so complicated if the PBMs just said
and you and I have talked
about this, about index pricing if the PBMs just said, all right, here's your discount, going to give you the index price, uh, period.
That's a negotiated price. and then the pharmacies would say. That's easy. And anybody looking in would say, oh, that's easy.
So then DIRs go away because it's so easy. That's the price right there
because it's so complicated. It would take
you an unknown amount of time to figure
out what the actual price would be.
Kind of like trying to like figure,
out a price for your wholesaler
of what something's going to cost, but they're saying that the PBM says, look. There's negotiations, but we don't know how much this is going to cost. We don't know if they did the star ratings. We don't know what wholesaler this or that, we don't know any of this stuff. How can we give the pharmacist that price right at that
time? We've got to have computers run all this
stuff. And then three or four months
later, we'll figure it out. And then
we'll figure out what the payment's
Greg Reybold: Yeah.
Mike Koelzer, Host 9/11: Do I have that right? That's what the confusion
means. That's where they try to confuse it.
Greg Reybold: Yeah. Yeah, and you know,
I'm gonna give you one of my favorite quotes from Antonio And it's where there is mystery there's margin,
Mike Koelzer, Host 9/11: Absolutely.
Greg Reybold: right? And that's what DIR fees was all about and again from a pharmacy perspective. It's it was horrible It's impossible to run a business. You're getting paid one thing.
They're taking it back later but When you step back and you understand, you know what the intent of Congress was and you understand the import of the CMS regulation You the pharmacies were the patsy. It was all about denying the beneficiaries the benefit of those discounts, right? But that's why you have so much variability.
If you move to an index based model, you're aligning the price. You're having one price point for a drug. What you were alluding to, and it was a study that, that 3 axis did, and they looked at, Mike, correct me. I think it was like duloxetine or something like that. I'm probably mispronouncing it, but they looked at the same pharmacy.
Same PBM, same day, same drug. And there were five price points that day, ranging from like 9. 30, I think, to Right? 9 to 96. And this is the same PBM, setting the price for that drug, at the same pharmacy, on the same day. It's just, it's astounding. And, why that variability? And think about it.
If you're in Part D, And, you know, before CMS has updated REG. They're jacking that price up at the counter because they can take that on the back end They're creating a spread on the back end If you take that same drug and you're in a medicaid managed care state where you allow spread pricing You're that same pharmacy is going to be reimbursed rock bottom because they're going to create the spread then by charging You know, the state or the employer or the payer much more money.
And so if you're in Medicaid managed care, you're charging the state more, reimbursing the pharmacy low. If you're in Medicare Part D, the same drug, you're reimbursing the pharmacy high so you can create that spread after the fact.
Mike Koelzer, Host 9/11: You guys are too smart for me. Let me slow this down still. So if it was simpler. The beneficiary would get the discount
right then. So in other words, instead of them paying a hundred dollars for something, they might pay
70 for something the point of sale. So far so good or not.
Greg Reybold: Yes, yes, yeah, they're, they're, whatever their cost share is, whatever their copay is, is going to be based on the actual price that the pharmacy is getting reimbursed.
Mike Koelzer, Host 9/11: because they're paying a percentage of that. Is that right?
Greg Reybold: Could be, right, they could be paying a cost share, they could be in their deductible phase.
Mike Koelzer, Host 9/11: if the price was
lower, they would pay lower at the counter. because it's so confusing. The PBMs can say, well, we can't negotiate that. It's too confusing at the point of sale.
We'll do it later. But it seems like somebody would say, okay, do it later. And then at that point, let's say the old person is the old person. Let's say the old person, instead of them paying 70, they paid a hundred. Wouldn't they say then, all right, it's confusing
now. We're going to do the math later and we're going to mail that
person back 30
to make it
I would think that they would send it back to
the old person, but don't.
Greg Reybold: They don't.
They don't.
Mike Koelzer, Host 9/11: it gets that far, it's smoke and
Greg Reybold: Yeah, yeah, that's, yeah, that's right. And because CMS paved the way, right? CMS had paved the way by allowing them to deprive beneficiaries of the discounts if they can't be reasonably calculated at the point of sale.
Mike Koelzer, Host 9/11: Does it go on further and say, you can't do it at the point of
sale, but later we'll give you the
discount.
Does that carry on?
Greg Reybold: doesn't. It should. it should,
Mike Koelzer, Host 9/11: they just say, if we
can't
Greg Reybold: No.
Mike Koelzer, Host 9/11: the point of sale, you're not going to get it,
Greg Reybold: some of it goes back to CMS. PBMs get to keep a lot,
Mike Koelzer, Host 9/11: they don't even pretend it's going to go back to the
elderly. They just say, we're not
going to give it then we'll figure it out on the
back end, but they're not going to get their money.
Greg Reybold: They're not getting their money. And so, you know, you've got a scenario where again, you know, they're paying cost shares and deductibles based on gross pricing not net pricing of the rebates and they're not even getting the benefit of the pharmacy discount. So again, CMS has updated the rule with regard to pharmacies and discounts, right?
Mike Koelzer, Host 9/11: basis and I know I asked this, but
if it's not percentage, it could be tiered copays,
something like that, if the
drug's more expensive, you're going to pay a
higher copay. Somehow they're not getting the discount.
Greg Reybold: Yeah, and think about this, you know, just to make it worse all the time, you see this, Mike, I'm sure, right? Brand mandates. Right? There's a cheaper generic available. The patient's in their deductible phase. They get, you know, forced to get a brand that costs a couple hundred dollars more. The PBM pays nothing. In that scenario, the patient walks in. The senior walks in. They think, my god, I've got insurance. It's saving me money. They slap down that insurance card. Pharmacy tries to fill it, DAW 9 right, DAW 9 code, brand mandate, patient forks out a couple extra hundred dollars, covers the drug with their, you know, their deductible amount, PBM doesn't come out of pocket a dime, but then they get a rebate from the drug manufacturer that they didn't share with the patient.
Right, that they didn't share with the patient and they're getting paid for that and we've seen, you know, rebates as high as, you know, 50 percent on some of these brand name drugs. So they're not coming out of pocket. They're forcing the patient to come out of pocket a couple hundred dollars more and then they're getting the money from the rebate and then, you know, pre the DIR fix, what was happening is they'd also take some of that money back from the pharmacy.
So the patient, the senior, is putting money into the insurer and PBM's pocket. Their insurances cost them money and they're paying more than the pharmacy's reimbursed and they're getting a brand when there's a cheaper generic. And 9096 looks to remove those warped incentives and move to a system where the PBM isn't setting the price of the drug. The drug price is aligned for the patient, for the pharmacy, for the taxpayers. Right? There's no brand mandates, and the patient gets the benefit of drug maker discounts.
Mike Koelzer, Host 9/11: Greg.
About five years ago, 10 years ago. I don't know how long ago I said to hell with all this star rating stuff and calling the doctors for 10 minutes to do the PBMs work and things like that. Sometimes I said to my team at the store, I was like, maybe we're getting screwed
And things because we don't do that.
We're like so far to the bottom of the star. we're like in center of the
earth, was that valuable for pharmacies
that did all that
baloney?
Did they get a lot back? was it
taken from me and
Given to them?
Or did they
I feel that it wasn't worth it. either?
Greg Reybold: I, I don't know that I can answer it. Look, you know, certainly you know, pharmacies that jump through the hoops got you know, may, maybe we're a little better off, depending. Right? And, and that whole thing is so complicated too, But here's the thing. They were all hoops to jump through to create a show.
Right? It was never about taking care of the patient for the prescription drug plans. It was about denying the patient the benefit of those discounts.
Mike Koelzer, Host 9/11: it's like, we'll
prove to you how we couldn't do it. How complicated it is. We'll set up all this
baloney
star stuff to
prove that we couldn't have given it to the patient up
front. Greg, I was at the
pharmacy the other day and one of my guys comes up and he says, good news and bad news.
He said this
one company that they've never paid us a dime, but it was a
card and they're taking DIR
back.
They've never paid us a dime because the copays have been so
high for the patient. I said, well, that sucks. He said here's the other part though. We just got a check for 30, 000. Now mind you, we haven't done a brand name for three years. We just got a check for 30, 000 from one of the big PBMs. I'm like, well, gonna take it back and cash it before they can put a stop to the check. So we get this 30, 000 check. We email, they give us some gobbledygook positively, about getting it. No details, of course. I told
my guy, I said isn't that a pisser? Isn't that sad
We had no idea this
was due to us. You know,
Greg Reybold: not.
Mike Koelzer, Host 9/11: wouldn't have known
if we
got it or didn't get it. secondly, We did the
same damn work, whether we
got that 30 grand or not.
And now we have it , now I'm not ripping the check up. I'm not that sad about it, but that's one of the saddest 30, 000 I've ever gotten.
Greg Reybold: Yeah, it's sort of pointy the
the way you put it, right? I mean, it's just indicative of just how
just how broken it all is. Right?
Mike Koelzer, Host 9/11: Greg, I sent this guy to my store. I sent him this, article
Greg Reybold: Oof, yeah.
Mike Koelzer, Host 9/11: Was it one of the magazines or something? In one of the
Congress. I was saying how good PBMs are, I said to my guy I said check out his donors. there.
He's just another side of
the story He emails me back about three
minutes later. He says he had thousand dollars from
so and so, You know,
such a dirty Dirty thing
but it brings up the bigger question all this got by the PBMs.
greasing the hands and filling the pockets of politicians? Is that why these things are so damn dirty?
Greg Reybold: What I would say is this, I think that they have brought layers and layers And layers of complexity to drug pricing. Yeah, And deliberately, and they're able to leverage that, and keep in mind, look, this is what we do, this is the world that we live in. If, you know, in a state house or Europe and, U.
Lowering costs or whatever it is that they're appearing to do. And keep in mind all of their savings, their quote, purported savings are off of, right? You know, list prices and gross prices and all that stuff that they've had a hand in inflating. But so I don't I don't think that it got to be this way, you know, with, you know, backroom bribes, so to speak, right?
But I think that these are amongst the biggest companies on earth, and they have brought layers of complexity at, again, and I think quite deliberately, in working agencies at the state and federal level in a manner that the agencies are carrying their water, And they don't even know it.
Mike Koelzer, Host 9/11: I'm kind of fascinated sometimes why different cultures
might believe different things
Greg Reybold: Yeah.
Mike Koelzer, Host 9/11: It's where they were born, you know? If someone's born in this part of the world, they're this.
Persuasion or faith and someone else is brought up here. They're that
faith. And it's like, what are the odds of all these people being all born in the same part of the world where their faith is correct.
It's just showing it's like where you were brought up, but PBMs it's the same way. I mean,
these PBMs have just flooded these people and
everybody from day one. It's hard for people to break out of that. Culture when they were figuratively brought up in it with PBM saving
everybody
money. it's hard to get out of that orbit.
Greg Reybold: Plato's Parable of the Cave, right? They've got all of us looking at the shadows.
Mike Koelzer, Host 9/11: I just learned that last week for the time, actually, that Plato's
cave thing.
Greg Reybold: Oh, really? Was it, was it when you were at the, uh, on the vacation with the old books, or?
Mike Koelzer, Host 9/11: no, It was on YouTube. I wasn't,
reading the
Greg Reybold: I was like, did you bust out Plato while you're on vacation? That's impressive. That's,
Mike Koelzer, Host 9/11: but you know, Plato was his nickname. Did you know that?
Greg Reybold: I think I didn't know that. Yeah.
Mike Koelzer, Host 9/11: name that I didn't know, but it may be ringing a bell. I forget what Plato meant, but
That was his nickname. Greg I
we need to do a little plug. And you didn't tell me to do this. We need to talk a little bit about APCI. American Pharmacy Cooperative
Inc.
That's who pays you.
Greg Reybold: That's
Mike Koelzer, Host 9/11: Who are they? What do they do? How do they benefit pharmacists?
Greg Reybold: Yeah, yeah. So, um, they're based out of Birmingham, and they're member owned, So, owned by independent pharmacies. We're, we're by independent pharmacies. I'd say between 16 and 1700 independent pharmacies. So, independent pharmacies are owned. And, you know, the core function of, you know, buying groups is to, you know, negotiate favorably.
Yeah, yeah. Favorable, you know, drug prices from, from wholesalers, right? But, you know, what APCI has done
You know, I think quite deliberately, really focus on advocacy for years and years and years. And so I got to know APCI in my capacity as general counsel and, uh, government affairs at Georgia Pharmacy Association.
Greg Reybold: And so we picked some really really big fights, you know, when I was there and you know, introduced a lot of first in the nation things again, pharmacy patient protection act, first, uh, steering the law in 2019, uh, really struggling in 2020. And worked really closely with APCI, and they were super, super supportive, when frankly others weren't, right?
Sometimes this is really forward looking legislation, it doesn't look like legislation in the past,and um, you know, they were always like, let's go, We completely support that. And so ended up working really closely with them, um, you know, for, for many years in my capacity at Georgia Pharmacy Association.
And then, you know, when I had the opportunity to say, hey, let's, let's take this to make it bigger, obviously jumped at the opportunity to do that . and again, we had worked very closely in Georgia. Um, but we're, we're in over 30 states and, you know, obviously we're not active in every single state from an advocacy perspective, but we try to be, you know, really supportive whether it's policy solutions, whether it's drafting legislation.
Any way that we can help in the advocacy fight, we certainly do that. And then, of course, we're, we're, you know, more involved at the federal level now than, than ever have been, and
glad to be there fighting that fight.
Mike Koelzer, Host 9/11: This is part of your job description. In other words, you've got a job there too. I imagine as a cooperative, you're doing a lot of contracts with buying groups, . with different wholesalers and
anything that a buying group would need an attorney for, but you're doing this. I always see you in this other stuff. For me, it's
like people see me in the
podcast. Doing this, But they don't know that I also sit on my ass at the pharmacy. You know, so I do both, In your mind, like, what is your split?
And do the leaders, I guess, all of the co owners, tell you what your split should be?
it's not like a hobby, this national stuff. How much do you figure you
split between this and that?
Greg Reybold: not a hobby, right? But certainly a passion is what I would say, but you know, you know, the general counsel had, you know, we're in 30 states, you know, big, big company. And so, you know, there's, there's, there's a lot of legal work that gets done for sure, right? On the contracting side and, and other things and nothing in healthcare is simple, right?
From a, you know, regulatory compliance perspective, so, you know, spend significant time, you know, with the general counsel head on. quite deliberate in dedicating time to the advocacy and, But in terms of a split, tough to say, right?
Mike Koelzer, Host 9/11: Yeah, and these aren't the days of old where you've gotta go to Washington for everything you want to do. I mean, you can sit at your keyboard and shout out to the world.
Greg Reybold: I'm getting the age now, Mike, where you can also get hurt sitting at your keyboard. I was
a couple of weeks ago sitting perfectly still at my keyboard, staring at my screen and somehow pulled a muscle. So
it's not without risks that these, you
Now, sitting behind a keyboard, I guess that is my point. But literally, I literally wasn't moving. And so don't think it doesn't take guts to sit behind a keyboard all day, alright? It is not without risk.
Mike Koelzer, Host 9/11: I was just on Amazon last week at home. I've got one of these wands, you know, that you do
Greg Reybold: Yeah, yeah.
Mike Koelzer, Host 9/11: give yourself a back
massage. At work, I'm like, I need one of those things here because you know, I just sit there,
Sometimes I'm tense on the computer keyboard, or maybe just a certain position. I said, I'm going to buy one of these for the
pharmacy. And then I thought, you know what?
I got a whole crap load of massagers in our cupboard when the kids, you know, they'd buy
Greg Reybold: Yeah, yeah,
Mike Koelzer, Host 9/11: or you'd get, you know, when you got to buy something for the man who has everything. What the hell are they going to get me? I've got enough socks and you know, I don't wear ties. That's what I mean by everything.
So I bring one of these big, they look like something from like Gilligan's Island, like this big life jacket thing goes around your neck, like a horseshoe and it's a
Greg Reybold: Oh God. I'll buy it off you. Name your price.
Mike Koelzer, Host 9/11: Greg, one thing I see, I like to sometimes look at the I know your history and, stuff, but I like to look at the
LinkedIn feed sometimes
Greg Reybold: Yeah.
Mike Koelzer, Host 9/11: show, just to see what people are pissing and moaning about. But I see on yours, like in the last day or two, it said you want bill co sponsors.
What does that mean for co sponsors? and
What else do you want? How
Do you want people involved? Do numbers help?
Greg Reybold: Yeah. Look, numbers absolutely help. And, you know, Congressman Auchincloss has worked on this bill. Um, it, in a really inspiring manner, right? Because so many folks will introduce a bill and, and that's about it. But he has, he has been really advocating for this passionately. And one of the things that he's asked for is for community pharmacists to really rise up and help him, you know, get co-sponsors, for this piece of legislation.
I think as of today, we're sitting at 14 or 15 co sponsors, which is a really strong start. And again, like Chairman of Oversight, Representative Comer is one of the co sponsors, which is just unbelievable. But, you know, here we've got Representative Harshberger and Representative Auchincloss, we've got folks who are willing to go out on a limb and, and advance the aggressive piece of PBM legislation that we've seen at the federal level.
And that's a big deal. And they're asking for help. And so we absolutely want pharmacists to reach out, call their U. S. representatives and ask them to co sponsor the bill, share with them the difference it'll make for their patients and for their pharmacies. And also, if they're active on social media, to, to tag their, their U.
And there are folks who are working really, really hard on this. I know, um, You know, I know you were on the, uh, PBMs on the rocks with, with Jeremy. Uh, one of the things I'd say is PUT has just been an amazing champion for this bill and, and their, their board and executive director have just been, killing it.
And some of the most sort of successful states have really just thrown themselves behind this too. Kentucky, has been, I think I said it before, just, just absolutely inspiring the work that they're doing advocating for this bill. But we need all hands on deck, and pharmacists are busy, and their heads are down, and you know, it's, it's a rough year, but, but this is the time for them to be heard. and so we are asking folks to call, uh, write letters, email, and if you're active on social media, tag your U. S. rep and ask them to co-sponsor HR 9096, the Pharmacists Fight Back Act.
Mike Koelzer, Host 9/11: I never know , if letters are going to be there. I think sometimes letters, they don't read them.
Sometimes it's more like a love vote.
Like, Hey, Hey, uh, we got this many letters on this and
that.
Greg Reybold: Yeah, yeah.
Mike Koelzer, Host 9/11: like that. that. social thing of, Hey, it's kind of fun to tag people and let them know that you're on that.
The
staff might get pinged or something
on that. Does that help? Do you think
Greg Reybold: social media, man, I mean it's, and I don't know if you remember, but Representative Auchincloss in that House oversight hearing, you know, he was throwing out some drug pricing, and he had one that was like a 38, 000 percent markup. And, and so that video went viral on his Twitter, and there's over, um, there's over 7 million views out of 7 million, which is, which is just a ton. It was shared over 30, 000 times. And so just, you know, really just went, I mean, for me, right? If I get nine likes, Mike, I'm happy, right? I'm like, Oh my God, this is fantastic. Wow. Um, like, so amazing stuff. And so it is getting traction online and, and it's a great way to do it, right?
Tag and you're creating and sharing and just.
Mike Koelzer, Host 9/11: Well by definition, social. I wasn't even thinking about that. I was thinking about tagging them and they'll read they got tagged. I forgot about the whole damn thing about social media. These things can spread then. So what a great way to
get involved in that.
Greg Reybold: Yeah,
And, and it has, right? I mean, again, that was, that was the hearing where he introduced the bill and that thing means, it spread. There were patients sharing it. There were physicians sharing it. And so it was, it was a really, really neat thing. And we want to, you know, just keep that attention going because that's what we need.
Mike Koelzer, Host 9/11: Greg, is the, I'm thinking co sponsor is just like someone stands up and then the next person stands up and yeah, we're with them. Is that what it is? It's just showing everybody's together or is there something
more to co-sponsor?
Greg Reybold: Well, I mean, I think there's something more to it, right? Because again , they're taking their time to lend their name to a piece of legislation when there's thousands of pieces of legislation that they could lend their name to, right?
Mike Koelzer, Host 9/11: showing that it's important enough to do that. Yeah,
Greg Reybold: attention because let me tell you something, 50, 60, 60, you know, PBM pricing bills out there, they're working against HR 9096 probably the hardest right now because, because it scares them and they see that it's getting attention, right?
And so that's a, that's a big deal, but here's why it's important, Mike, forever. We have not seen aggressive PBM reform legislation at the federal level because folks didn't think there was an appetite for it, I suppose, right? What we want to show, and I think we've already shown it, but we want to keep showing that, you know, not only is there an appetite for it, but, but there is, you know, there is a There is a movement.
There is a consensus. There are people across parties who are willing to take the time to sign their name and fight for aggressive PBM reform and putting a stop to these practices. And so it absolutely makes a difference. You know, Congressman Auchincloss, I think, has said his ultimate goal, he would love to see 25 D's and 25 R's co-sponsor that legislation.
So we've got, we've got a ways to go in that regard, to a really strong start and we want to keep that momentum going.
Mike Koelzer, Host 9/11: Yeah. anybody listen to this.
You're already on the phone, listening to this. tag this podcast if you want to tag it
Greg Reybold: Absolutely.
Mike Koelzer, Host 9/11: It's going to have Greg's Delightful face on the front of it and it's gonna have something about PBM on or something So just send that to them.
Greg Reybold: Absolutely.
Mike Koelzer, Host 9/11: All right, Greg got a white paper coming up and what is that? And we're going to put a link to that in the show notes. So anybody listening
now, right when you're done, hop on the
show notes and click that.
What
is that?
Greg Reybold: was a fascinating OIG audit audit. Yeah. Yeah. in the Federal Employee Health Benefit Plan, the U. S. postal workers, a couple of, uh, a couple months ago, and we did a white paper on that because there were some really important findings in that, particularly if you read between the lines, because what it found, you know, pharmacy's been warning about these offshore rebate aggregators for years, and lo and behold, oh, guess what?
You know, there's rebate dollars flowing through those aggregators, and they weren't being passed back to the client on a pass through contract. And oh, lo and behold, they're denying rebates and payments from drug manufacturers to their, to PBMO pharmacies and even pharmacy discounts via fees under the argument that, well, these are aggregate discounts, they're not drug specific. So really important findings there, right? But there's been plenty of studies about Part D, about Medicaid managed care. And, one of the things that the Oversight Hearing and some other PBM facing documents that we've heard lately is, Oh, hey, independents are getting paid more.
Oh, hey, you know, we're, we're not steering. Um, And we're not setting prices, things like that. And so what we did is we looked at a large federal employee health plan. And again, the federal employee health program is the largest self funded employer in the nation. And so we looked at some publicly available pricing data through a pricing tool, and we looked at an independent pharmacy in Kentucky and that independent pharmacy, Kentucky closed its doors in August of this year.
Despite the fact that Kentucky has just been one of the most successful states, here we are, and you know, helps on the way via the Kentucky state legislation, and we still have pharmacies closing their doors. And so we looked at the pricing. Mike, astounding. And so like here, atorvastatin. The independent pharmacy that closed was being reimbursed 12. 58. The highest chain payment, same day, same drug,same plan, 90. 90 to the highest paid chain, 58 to the independent pharmacy. We then looked at mail order pricing because of course, you know, what do the PBM execs say? Oh, hey, listen, You know, our mail order is a cost saving solution. And lo and behold, what we found, and we looked at, I think, like 20 of the most commonly prescribed generics. And guess what? Mail order, getting reimbursed more, right? So atorvastatin, again, the independent pharmacy, 12. 58. Mail order pharmacy, 27. And again, that's pretty consistent, maybe not on every drug of the top 20, but, but a really, really consistent pattern there. And then what we looked at is, well, what if, what if, The beneficiaries in this plan wanna fill a quote, specialty drug, right? A, you know, an MS drug, and I'm saying that in quotes, but a MS drug, a low blood pressure, a cancer drug. And lo and behold, we just ran a few handfuls of drugs that we know PBMs like to play games with.
And the most stunning one for me was the teriflunomide. I don't know if I'm pronouncing that right, but, so the naac on that drug is $16 and 20 cents. The independent pharmacy couldn't fill it, right? The patient can't get a price at the independent pharmacy for that. Has to be filled at the PBM owned pharmacy. NADAC, 16. 20. PBM Specialty Pharmacy, 7, 636. 47, 000 percent markup , Mike. And, you know, we are going to be pushing, pushing this report out. And, you know, frankly, I think the hope is, A, even that it opens the eyes of some pharmacists And and spurs them to action because, you know, they know it's happening, but even for them, it can be anecdotal, right?
You don't see what the chain's being reimbursed. You don't see what the specialty pharmacy is charging. And so it's, this is eye opening stuff, I think for pharmacists, I think for patients, but my God, the hope is that this is going to help compel congressional action because you can't look at these things and think the status quo is Okay. You can't look at these things, Oh, hey, no problems here, right? I mean, you've got massive markups, You've got independents that can't fill, the higher margin drugs. You've got the independent being reimbursed less than the chains, and then even less than the mail order. And so I you know, I think it's compelling.
I think it's outrageous. And it's definitely something that we're hoping to have some really substantive conversations around.
Mike Koelzer, Host 9/11: I think of planned sponsors too. Somebody who's listening to this, that maybe has insurance for their employees and realize they might be paying their smiling broker for this, you know, PBM, this whole side, they're paying them seven grand for something that someone could buy for probably thirty bucks cash, something like
Greg Reybold: Yeah, that's right. And listen, man, you know, that, you know, that's, that's one fill, right? And, you know, you know, there's, there's multiple patients on these drugs and multiple times a year, right? That's, that's for, that was for 30 tablets, right? So, you know, patients on that for 12 months. I mean, the math just gets, just, just incredibly disturbing.
And you know, one of the things that we haven't talked about, but I'll touch on briefly that HR 9096 does is, by moving to an index based price, it also caps that price, right?
So it's gonna, It's gonna cut out the ability for a PBM not only to steer those drugs to their pharmacies, but to mark them up, you know, 47, 000 percent, 10, 000 percent, 8, 000 percent, 300 percent, right?
It's gonna stop their ability to do that.
Mike Koelzer, Host 9/11: don't usually give marching orders to the listeners, but here's the marching orders to our listeners, take this episode, tag somebody in it, send it on, keep it going.
Have them listen to what Greg's talking about here. Go to the white paper in the notes and send that out. Send it to a handful of people, tag them, this and that. That's good information to let sit there.
Well, golly, Greg, what a pleasure having you on. you're going to be coming back
so many times it's just kind of like, Hey, Greg, we'll see you next time. You know you're a busy guy, Greg, as we know, I appreciate
I know our listeners appreciate it, you. coming on, thank you.
We appreciate you.
Greg Reybold: Well, I appreciate the opportunity to be on. And again, you're one of the first people who is really doing deep dives talking about these things. So it really is always a pleasure. And always, enjoy listening to your podcast as well. So thank you.
Mike Koelzer, Host 9/11: Greg. We'll talk soon.
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