CVS Health announced yesterday that Walmart has notified the company of its intention to leave the CVS Caremark pharmacy benefit management (PBM) commercial and Managed Medicaid retail pharmacy networks due to an ongoing pricing dispute. Patients with CVS-administered drug benefits (including Arkansas Blue Cross Blue Shield) and Medicaid enrollees with CVS drug coverage may no longer be able to have their prescriptions filled at Walmart stores if the retailer follows through with the announcement.
“It’s no surprise to Arkansas pharmacists how PBMs operate, but last year patients got their first look behind the curtain of the pharmacy benefits management industry when many of them weren’t able to use their pharmacist of choice because PBMs weren’t paying a fair price,” Arkansas Pharmacists Association COO John Vinson said. “Now, the world’s largest retailer is leaving the CVS network because of the challenges that Arkansas pharmacies have been facing for years.”
In early 2018, Arkansas pharmacists had their own battle with CVS/Caremark and other PBMs when they slashed reimbursement prices that pharmacists receive when they fill a prescription.
In many cases, CVS/Caremark was reimbursing independent pharmacists at a rate lower than the pharmacy paid to purchase the medication, while paying their own CVS pharmacies at rates much higher, keeping the money in their own pockets. In addition, CVS and other large pharmacy benefit managers routinely use anticompetitive tactics to steer patients to themselves - their PBM owned mail order and PBM owned retail pharmacies - disrupting the patient’s control over their own healthcare and creating a “heads, we win/tails, you lose” approach to patients and benefit design.
After months of lowered reimbursements and pharmacies on the verge of shutting down, a concerted effort of pharmacists, legislators, and patients led the governor to call a special legislative session to sign emergency legislation that would require PBMs operating in the state of Arkansas to be licensed, allowing the Insurance Department to oversee the previously unregulated and unmonitored PBM industry.
“A healthy market and fair competition lead to better prices and better health outcomes,” Vinson said. “A broken market leads to financial enrichment of monopolies. For example, according to a recent Wall Street Journal article, PBMs overcharged taxpayers by $9.1 billion through Medicare Part D. Arkansas legislators worked swiftly and effectively to make Arkansas a national leader on PBM reform; it’s time for CMS and Congress in Washington, D.C. to take action to protect taxpayers and patients.”
The Arkansas Pharmacists Association, founded in 1882, is the statewide professional association representing approximately 2,200 pharmacists in Arkansas. APA strives to further the professional advancement of pharmacists, advocate the value of pharmacy, and safeguard the health and well-being of every Arkansan. Its mission is to advance a professional and business environment for Arkansas pharmacists to be successful and fulfilled in serving patients.