The New Mexico Senate Public Affairs Committee has approved legislation that would carve out pharmacy benefits from the state's Medicaid managed care program. SB 184 by Public Affairs Chairman Gerald Ortiz y Pino was voted out of the committee Feb. 7 with a do-pass recommendation on a bipartisan 7-0 vote.
In laying out his bill before the committee, Ortez Y Pino stated that pharmacy benefit managers have made huge profits off New Mexico Medicaid by financially “bleeding” independent pharmacies in the managed care program. He said supporting independent pharmacies in New Mexico is critical to the health and welfare of the state, especially in rural and small-town New Mexico.
NMPBC lobbyist Minda McGonagle testified in support of the bill, as did New Mexico Pharmacy Association Executive Director Dale Tinker. Representatives of Prime Therapeutics, Presbyterian Health Plan, Blue Cross Blue Shield and America’s Health Insurance Plans testified against the bill, but committee members were not swayed from their stated concerns that New Mexico independent pharmacies are slowly and inevitably being put out of business by managed care and PBMs.
Republican Sen. Steward Ingle, the Senate Minority Floor Leader, was incredulous that pharmacists make little to no money on the sale of medications while receiving a dispensing fee of just 35 cents in the managed care program.
“If they’re getting just 35 cents, they ought to have a tip jar,” Ingle quipped.
McGonagle cited West Virginia’s 2017 carveout of its pharmacy benefits from managed care as a successful example of how a state can save money on Medicaid pharmacy spending while paying pharmacies fairly for their products and services.
She pointed out that West Virginia saved $54.4 million in its first year (2018) of directly administering its own Medicaid pharmacy benefits and is working with the West Virginia University School of Pharmacy to identify ways to both reduce costs and improve patient care.
Some members of the committee expressed concern about the carve-out’s estimated $69.5 million annual fiscal impact on the state, but admitted that the state must do something to bring financial relief to independent pharmacies.
Sen. Gerald Ortiz y Pino