(upbeat music) - Welcome to the ASHP official podcast, your guide to issues related to medication use, public health, and the profession of pharmacy. - Thank you for joining us for the ASHP Advocating for Impact podcast, where every episode covers a policy issue impacting the practice of pharmacy. We'll do our best to translate the policy and the politics to help you understand how these issues impact your practice and your profession. I'm Tom Krauss, the ASHP's Vice President, Government Relations, and I'll be your host for today's episode. Today I'm joined by Kyle Rob, ASHP's Director of State Policy and Advocacy. This is the third in a series of discussions we're having focused on pharmacy benefit managers or PBMs, their business practices, how those practices affects patients, and the profession of pharmacy, and how policymakers are seeking to bring them in. Episode two covered some of the common tactics that major PBMs employed in narrow networks, and forced patients to utilize PBM affiliate pharmacies. This week we're gonna be continuing that exploration of PBM for the integration by looking into payer and post policies related to clinician administered medications such as IV infusions. But before we jump into that specific topic, there's been some breaking news in this area, and I just wanna get Kyle's kind of overview of some of those issues. So before we jump into white bagging, there's been some litigations of cases filed. The FTC sued the PBMs, and the PBMs also sued the FTC. So let's start with the case against the PBMs. Kyle, can you just tell us what FTC sued the PBMs for? - Sure, absolutely, yeah, and this is hot off the press. So this was September 20th, FTC announced that they're filing a new lawsuits against the big three PBMs. So for those of you there to keep in score, that's CareMark Express Scripts and OptimRX. FTC filed a suit against all three of them, and several of their affiliate and subsidiary organizations, basically alleging that they've unlawfully conspired to inflate the prices of insulin, thereby blocking patients' access to lower cost products, and artificially increasing costs for everywhere. Basically, the suit alleges that all three of these PBMs purposefully and knowingly and intentionally put forth actions basically to incentivize the rising of these list prices so they could collect rebates off of those high list prices. With the knowing and stating attention to basically steer patients towards certain products. So the high list prices basically make it so whatever the formula or decision that the plan makes is whatever the patient is more or less forced to taking because if the list price is very high, then cash paying is not really a legitimate option. And PBMs have faced similar suits in the states and localities around this exact behavior, and their typical response is that we do not manufacture set list prices, we don't set list prices. And this is just sort of a byproduct. Start market goes up, start market goes down, we aren't driving this behavior. But FTC really pushes back against that type of rhetoric and argument by saying no, a lot of your specific policies are directed towards us, and what they point out is, they say plans could have been calculating patient cost sharing based on the net price to take these insulin is not list prices. And they require that cost sharing to be done based on list prices, which seemingly is evidence of a conscious effort to shift cost sharing onto onto patients. They also point out that several of these manufacturers came out with authorized generic versions of these insulin, so the exact same product and the exact same manufacturer for a much lower price. FTC also points to cases in which an authorized generic version was offered to the plan for a lower list price and net price, and the plan declined that in favor of the higher and net higher rebate medication. - And so some of these behaviors that you're describing are consistent with what was described in that FTC report that we talked about in the first episode of this podcast series. So for listeners who haven't kind of caught up on the other episodes, check out that first episode that gets into some of these different issues. Now Kyle, you mentioned manufacturers. Does the case that FTC brought a ledge anything on the you have to make? - So the manufacturers were not named in the initial case filing. And as of the time it was recording, the FTC has not sued the manufacturers yet. However, in the press release announcing these lawsuits against the PDMs, they did say that the manufacturers play a quote concerning an active role in the behavior alleged, and they say they're contemplating additional enforcement actions against manufacturers too as well. - Interesting, so we'll be on the lookout for more to come there potentially. - Okay, so that's the case that FTC brought against the PDMs, and honestly that's probably the bigger thing to watch going forward to kind of rein in those PDM behaviors. But the PBMs also sued FTC about that report that I mentioned it, that we discussed in the first episode. What's going on there? - Correct, yes. So this was a couple of days before FTC sued. Just Sigma filed suit first. So on September 17th, Sigma, who is the parent company of express groups, there's more of that vertical integration for you, they sued FTC alleging that the staff report, again, that we talked about in the first podcast, saying that report contains inaccurate misleading information, they basically say that FTC relied too much on anecdotal information, and they received during the comment period, and ignored a lot of the information that was supplied directly by the PBMs. A lot of the criticisms in this complaint do mirror some of the criticisms that were alleged by the FTC commissioners themselves during the vote to release it, as you mentioned, it was a four to one vote, with two of those commissioners voicing a little bit of concern over process. So a lot of legal experts are speculating this lawsuit is really might be a way to try to pressure FTC to readdress, potentially holding a vote on redacting the report. That being said, I mean, I think their math is very thin there, I don't necessarily think they have the votes to do that. I think most observers sort of see this as a, sort of do something move or a try to change the conversation move, and not necessarily a strong legal case that is likely to win on its merits in court. - It has the feel, really, of a kind of an advocacy public relations and kind of government relations play of, well, I can see that I'm gonna get sued in a few days. I'm gonna try to insert some uncertainty about the allegations here. So we'll see. Obviously, everyone will get their day in court, and this will be, this will be hashed out, but I think we're gonna be kind of paying the most attention to that FTC case against the PBMs. And I think that's probably the things most likely to actually have an impact on behavior. Okay, so let's shift the conversation to the kind of specific topic that we wanted to cover. And in this podcast, which was white bagging, site of care, steerage. So can you just kind of explain what these terms mean and how do they fit into these kind of overall suite of PBM papers? - Sure, so, you know, I will mention, you know, most of our listeners have probably already heard of these terms white bagging, site of care, steerage. If those terms are totally Greek to you and you don't know what either of those things mean, I will also just plug that ASHP has extensive advocacy resources and a podcast on white bagging where you really dive into what it is and sort of different distribution models there. So we'll put a link to that on the webpage too as well, but this is for a very, very, very high level overview. White bagging, brown bagging, and site of care, steerage are policies that really reference or are most relevant to infused medications. They apply to what we call clinician/emistor drugs, basically a drug that cannot reasonably self-emistory by the person to whom it's prescribed. So white bagging, or I guess we'll take a step back, typically when a patient is administered in a fused drug in an outpatient setting, the historical way that drug was sourced and prepared was that the administering provider, whether it be a hospital, outpatient department, clinic, what have you, would acquire the medication in bulk directly from a wholesaler, then when a patient comes in and a medication orders received, they would then prepare the medication from their bulk drug stock and administer directly to the patient on site. That's known as buy and build. There's been a bit of a shakeup in the way that these clinician/emistor's drugs are distributed in recent years. We've seen a rise of so-called bagging, white bagging and brown bagging. So in a bagging system, rather than the administering provider acquiring the drug directly from their wholesaler, a separate third-party pharmacy fills and dispenses the drug as an outpatient prescription and then mails that single dose to the administering provider. So when the medication is mailed directly from the pharmacy to the administering for infusion provider, that is called white bagging. When the non-self-administered drug is dispensed directly into the custody of the patient, whether that be in person or via mail order, and then the patient is responsible for transporting it to the clinic for administration that is called brown bagging. The site of care steerage is a broader phenomenon in which insurers are attempting to steer incentivize or block by various means, push patients towards certain sites of care and away from other sites of care. So most often, it is typically seen as payers trying to push patients away from receiving these infusions in hospital outpatient departments and towards receiving them, either in their home via home infusion or via a separate freestanding infusion clinic, which surprise, surprise, oftentimes is affiliated with or under commonly owned body payer. - And so these scenarios that you're describing, you mentioned that they're kind of steering towards these models that are affiliated with the payer, but really in all of these circumstances, the patient's care, the patient was initially seen by a health system provider. That's what drove the diagnosis. That's how their treatment plan was developed. But once it's time to actually receive that care, the payer's trying to basically grab that patient, push the care team away and kind of use its muscle to kind of control where the patient is receiving therapy. So what I wanna kind of understand is in these scenarios, these are still health systems that have a contract with this insurer and is participating in their network. And that's why the patient was originally seen there. So how does the PBM kind of get away with these policies that essentially elbow out a provider that is in participant in its network? - Yeah, that's a great question. I think I question a lot of the health systems and the cells are asking when these sort of policies first came up. So, you know, sometimes insurers do try to insert these provisions in their contracts around the sourcing of these infused drugs or clinician and Mr. Drugs. But more so, it's actually done outside of the typical contracting cycle. So, the typical way that a lot of providers that I've heard about here about way-banging policy is just they get a fax from the payer, you know, mid-contract cycle say, "Hey, by the way, we're gonna stop reimbursing you "for buying these drugs yourself. "They have to come from our pharmacy." And that does beg the question of how do they do this. So there's really a couple of levers in the regulations to statute. They sort of rely on to do this. The main one would be really distorting or using the definition of medical necessity to their advantage. And I say that because in the context of white bagging, they basically take the argument of, since the drug is available via a mail order pharmacy, it is therefore not medically necessary for you, the provider, to acquire the drug yourself. Therefore, if you do that, we are not gonna pay you because you're providing unnecessary care. Similar with side of care storage, right? Since there are other locations where you can conceivably receive this care, we're going to take the position that is not medically necessary for you to receive it in a hospital outpatient department with a higher level of care. So that could be a fixuated via a mandatory home infusion policy, right? So, you know, X-drug doesn't matter the details of the patient or the circumstances. If it is X-drug, it must be administered via home infusion or similar other cases that tie drugs to certain sites of care. Again, whether that be home infusion or whether that be a free-standing, you know, infusion clinic that is, you know, run with a much sort of lower operating standards and standards of care than what we expect from the hospital outpatient department. - Okay, that's interesting. So, I think normally when I think of probably policy makers and most listeners think of medical necessity, they're thinking about the medical necessity of the treatment itself. Whereas you're saying basically payers are taking a broad read of that term that basically says, and we're also gonna incorporate site of care in that medical necessity. - Correct, yeah, and we get down to the nitty gritty of arguing over statute, payers adopt the position that the location in which the care is received can be a valid consideration for medical necessity. So again, that's something that has been debated in state houses and some states have state of, contemplate a changing the statute to make it clear that they cannot solely take into account the location of the care as a component of medical necessity. - Okay, all right, so if that's how they drive patients towards these brown bagging and white bagging models, why is that bad? Like, can they provide that care effectively? Is there reasons we should be concerned about providing care both in a brown bagging or a white bag model? - So, I mean, I think beyond, you know, from the provider perspective, there's a lot of perceived unfairness in these policies, right, again, like their impose but contract and it sort of very much is seen as sometimes used as negotiating leverage, right? So we've seen payers sort of say, "Hey, we're gonna start requiring white bagging "for all these drugs," unless you're willing to agree to accept a lower level of reimbursement, right? Or they do these sort of similar tactics, again, if the laws and regulations say you have to open up your networks and they sort of create networks and networks, so there's the thumbs up network and the thumbs down network. So, you know, the good news is you're in the network but the bad news is you're in the thumbs down network. So yeah, I guess somebody in the thumbs up network. - So, you know, really, the lack of transparency, this is just another example of that, but in terms of specifically what is wrong with it, you know, for patients and providers, well, first off, the whole idea of this steerage really goes against the idea of accountable care and value-based care, right? You're telling the provider that, you know, you need to be responsible for the longitudinal care of the patient, not just providing more services to the patient, well, if you have the payer stepping in and say, "Oh, actually, you know, "you can take the small potatoes," but any time something actually profitable comes up for this patient, we're gonna provide those services outside of your health system where you're fracturing the care. And at the highest level, you're taking away the provider's ability to be accountable for that care and you're injecting more uncertainty into it by fracturing the patient care costs, the patient care process at the highest level. You know, in terms of how that looks in the ground, well, we've determined several negative associations with these policies for patients in multiple studies basically we've found that these policies, particularly white bagging and brown bagging, are associated with higher cost sharing for patients. Often this is carried out, right, by moving coverage of these drugs away from the medical benefit and towards the pharmacy benefit. Medical benefits typically have a lower deductible and lower cost sharing obligations than the pharmacy benefits. So by moving that, you typically increase patients' copays and for significant amounts, we're talking thousands of dollars a year sometimes. Additionally, you know, as part of that fragmenting the patient care process that we talked about, we've done studies that shown that these white bagging policies are associated with significant increases in canceled appointment, miss doses, lazy therapies, general suboptimal therapy. You know, they really handcuff clinicians' ability to make very precise, just in time movements and can really frustrate patients in lower quality of care. And then additionally, just the whole idea of white bagging, you know, where you talk about a process in which the administering provider is able to acquire their medication via a wholesaler in bulk and efficiently, you know, purchase the right amount they need, dispense the right amount they need, prepare the right amount they need to assist them in which each individual patient receives a separate parcel with an individual patient dose. It just, the idea from a supply chain and operations perspective just goes absolutely against everything that you learn in MBA school. And that model directly results in more increased drug waste as you have to throw out unused portions of doses that belong to individual patients. So there's just a lot about it that doesn't really make any sense operationally, that really complicates providers' ability to get care and really puts new burdens in complications in the patients too as well. It's really unnecessary. - And we should just say with regard to Brown bagging, you were describing a lot of the challenges with white bagging where the product is gonna be dispensed by the payer's affiliate pharmacy to the, and shipped to the provider in that circumstance of Brown bagging is shipped to the patient. So you have basically all the problems that you describe plus this concern about, you don't know how that product was actually handled by the patient. - Right, didn't even get in all the storage and fidelity issues. So yes, the issues with white bagging is in Brown bagging are numerous. - Okay, so if those are kind of the concerns and they are these kind of disruptive impacts on the patient care process. So how are payers able to push forward with these processes despite those concern? - Really at the end of the day, they just repeat and assist over and over and over again that these policies reduce costs for everybody, reduce costs for health sponsors, reduce costs for patients. That's not the reality that we see on the ground. However, there is still very much a back and forth to that against that. The lack of transparency in this space definitely does not help in trying to make an objective analysis of what the sort of cost implications are. But you know, we haven't gone through this sort of advocacy adventure in many states around white bagging and some of these issues around specialty pharmacy that are overarching. You know, there are a lot of existing structures that make it difficult to reform and change it. So one example of this would be there are a lot of rebate provisions within contracts between insurers and PBMs and between the employers or whoever else is sponsoring or paying for the healthcare plan. And they might include certain thresholds for receiving rebates or price concessions. And they're often terms rebate traps or contractual traps. So for example, you might, there might be a provision in the contract that the employer never really paid attention to or didn't realize that says, you know, if the 75% of this specific high dollar specialty drug goes through our affiliate pharmacies, then you get a big check, you know, for X number of dollars. And if you don't hit that number, well then you're going to miss that money and your premiums are going to go out. Well, if we consider, you know, an enabling pharmacy law or a prohibition on white bagging, well that plan is not going to hit that 75% because the law says you can't force all those people to go to the PBM affiliate specialty pharmacy. You know, that's good for the patients. It's good for quality of care. But in the near term that PBM can go back to the plan and say, hey, you're not going to hit your 75%. You're going to lose money on that next year. And that is really a way to get the plan sponsors to really stop and say, oh, actually, this might cost me money. But frankly, it's all artificial, right? You're being quote, cost money that was taken from you in the first place by the same person who's telling you it's costing the money. So it's just, it's a lot to unwind though. - Okay, so what do we do about that? What can pharmacists do? What can we do as advocates going through? - Particularly when it comes to these side of care and white bagging policies, awareness, awareness, awareness is extremely important. In the early days when we were first, you know, understanding the magnitude and scope of these mandatory white bagging policies, we would find that when a lot of pharmacy leaders would sort of look under the hood, they would realize many payers actually impose these policies months ago and they never realized it because it was done at small scale. And the people on the front line, those folks are just interested in getting people care, right? So, you know, one day they got this letter from the insurer that says, hey, you got to send it at this pharmacy. This is how the PA works. And they just did it 'cause they need to get someone care. And then later, as more and more plans pile on this, then the leadership realizes, wait, you know, all these sort of, these plans have sort of happened overnight. So, I mean, I think it's, being aware this is happening early can sort of stop a lot of the momentum here. So awareness in the pharmacist side, awareness in the health system side, but also awareness in the patient side. Patients understand when these policies are imposed, something is different. They often don't like it 'cause now they have to call another pharmacy, now they have to call it, now they have to pay a separate copy, but they're not totally unsure why. They're not totally sure why it's happening. So, I do think there's also an opportunity for pharmacist to again, educate patients when they see this happening. This is what's happening. This is why it's happening. This is why we need to advocate for PBM reform. And when we do talk about, you know, PBM reform and specifically white backing reform, patient advocates are extremely important to his advocacy efforts in this data house. So, you know, yeah, first is awareness, awareness for providers, awareness for patients. If possible to, you know, to get your health system to push backness, these payer policies and just get the payers, I think twice about implementing it. But if none of those things are effective, then the next step would be advocating for a change in the insurance laws and regulations. - Yeah, and you mentioned that engaging patients and other providers and we've seen at the state level where there are coalitions that bring together pharmacy, hospitals, physician groups, patient groups. They've actually been pretty effective at driving change in the state policy. You actually developed some of the model legislation working with some of our ASHP state affiliate partners around model legislation to prohibit payer mandated white bagging. Can you just say the kind of the short version of what that is? And Kyle mentioned that we have a full podcast on some of these white bagging policies, but can you give us the kind of the short version? - Sure, yeah. One more plug on ASHP's model legislation to prohibit payer mandated white bagging. So we developed this model legislation back in late 2020, early 2021, again, as we sort of saw more of these practices rolling out and people were looking for policy solutions. So what our model legislation does is it tells, it basically says insurers and PBMs cannot refuse to allow an administering provider to provide a drug if that provider was in that way for the purposes of treating and diagnosing, right? So basically you have to give the administering provider, the insurer has to give the administering provider the option to acquire the drug directly themselves, if that is how they think is most safely and most efficient to administer to the patient. Our model legislation does not make wider brown bagging a violation of pharmacy practice because we wanna make sure that clinicians have every option available to them in terms of how to source the drugs. We just think that insurers should not be unilaterally requiring people to source drugs in ways they don't think is efficient or safe for their patients. So that's really the core of what our model legislation does, but it also has several guardrails to basically make sure that payers cannot play these sort of games we were talking about before with networks or with cost sharing to try to disincentivize people or sort of effectively continue a sort of white bagging prohibition. So we've been involved and engaged in state houses in many states. We've actually had since 2021 over 35 states, I think have at least introduced a bill or considered a reforming white bag bill. And we've had about in the upper teens of states pass a law either specifically about white bagging specifically in line with our model legislation or a general piece of PBM legislation that will either curb limit or outright prohibit payer mandated white bagging. So we've seen a lot of momentum in the states around putting guardrails on payers ability to white bagging and we sort of continue to push for that. - And that comes from the advocacy of state affiliates providers raising concerns and patients kind of describing the impact that this has on their care. So Paolo, I think that's all the time we have today. I wanna thank you for joining us to discuss PBMs on our next episode in this podcast series. We're gonna look at so-called PBM group purchasing organization. So as distinguished from a traditional GPOs that many of our listeners will be familiar with. So these are these PBM group purchasing organizations are affiliated entities established by each of the PBMs and how these entities are utilized to aggregate rebate revenue and shield profits for those PBMs. So check out that next episode. If you haven't heard the rest of the series, please check that out. This kind of builds towards a greater view of PBM behaviors and then going forward, be sure your voice is heard as a pharmacist and as a constituent, you have tremendous influence at the state and federal level. You can visit ASHP.org to learn more about our key advocacy issues, grassroots efforts and ways you can get involved in ASHP's advocacy. Thanks for listening and thanks Kyle. - Thank you. - Thank you for listening to ASHP official, the voice of pharmacist advancing healthcare. Be sure to visit ashp.org/podcast to discover more great episodes, access show notes and download the episode transcript. If you loved the episode and wanna hear more, be sure to subscribe, rate or leave a review. Join us next time on ASHP official. (upbeat music) (upbeat music)
