Delaware Department of Insurance to regulate Pharmacy Benefit Managers

Delaware State News
Posted 11/2/21

DOVER — Insurance Commissioner Trinidad Navarro announced Tuesday that the Delaware Department of Insurance will begin the process of building and enforcing regulations regarding Pharmacy …

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Delaware Department of Insurance to regulate Pharmacy Benefit Managers

Posted

DOVER — Insurance Commissioner Trinidad Navarro announced Tuesday that the Delaware Department of Insurance will begin the process of building and enforcing regulations regarding Pharmacy Benefit Managers (PBMs) as a new law goes into effect.

The new authorities of the department will ensure consumer access to affordable medications and protect local pharmacies from the predatory behaviors exhibited by the PBM industry through measures of transparency and corporate accountability.

“Alongside members of the General Assembly, advocates, pharmacy representatives, and industry stakeholders, we have been working towards this goal for years,” Mr. Navarro said, referencing the work of the Pharmacy Reimbursement Task Force and other legislative initiatives and discussions.

HB 219, sponsored by Rep. Andria Bennett, Sen. Spiros Mantzavinos, Senate President Pro Tempore David Sokola, and Rep. Mike Smith, was passed by the General Assembly unanimously and recently became law, bringing Delaware’s oversight of the multi-billion-dollar industry on par with leading states.

PBMs act as intermediaries for prescription drug plans, influencing what medications will be covered and the costs of those drugs for both consumers and pharmacies. These companies bring in billions through manufacturer rebates, limiting generic drug offerings, and retaining negotiated savings, while costs for consumers continue to rise. The largest PBMs operate their own pharmacy chains, and their consolidated market power has, prior to this law, allowed them to pay unaffiliated pharmacies unsustainably low reimbursement rates — rates lower than it costs the pharmacy to dispense the drug to a consumer. PBMs’ move toward monopolization has contributed to waves of independent pharmacy closures across the nation, especially in rural, inner city, and under-served areas that already crave equity and access.

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