Link to Owner Dr. Robert B. Pamplin Jr.



At Congress and Legislature, steps should be taken to rein in the power of pharmacy benefit managers.

For many rural Oregonians, picking up prescription medications is an exercise in patience — and frustration. Across our state, patients are forced to drive hundreds of miles to the closest pharmacy and sometimes wait several hours to pick up essential, life-saving medications.

Last year, Bi-Mart made the decision to close all 60 of its Pacific Northwest pharmacies. The impact it's had on wait times isn't just aggravating for patients. It's a "canary in the coal mine" for the future of our state's rural pharmacies.

Today, there are fewer than two pharmacies per 10,000 residents in most Oregon counties and Wheeler and Sherman counties don't have any pharmacies. Demand is so high at the rural pharmacies still in operation that they can't keep up and frequently prescriptions can't be picked up for weeks. These "pharmacy deserts" pose a serious health risk to patients statewide — and if the situation doesn't change soon, it will only become more dire.

Oregon's independent pharmacies filled nearly 5 million prescriptions in 2020 and generated about $255 million in local economic impact, largely in rural communities. Those 5 million prescriptions are at risk of not being filled if independent pharmacies continue to face operational hardships due to pharmacy benefit managers (PBMs).

These middlemen reduce margins for Oregon's independent pharmacies to such a degree that they can't hire employees or, as with Bi-Mart, even stay in operation. Today, nearly 80% of prescriptions are controlled by large, out-of-state PBMs.

PBMs like CVS Health (Caremark), United Health (OptumRX) and Cigna (Express Scripts) purportedly negotiate discounts for health plans, employers and Medicaid/Medicare programs like Oregon Health Plan. In reality, they keep the bulk of the discounts they negotiate instead of passing them on to plan administrators and patients.

For example, a recent study from the Oregon State Pharmacy Association (OSPA) found that Oregon's Medicaid program was made to pay eight times the manufacturer's asking price for a multiple sclerosis drug, costing the state nearly $2 million extra.

PBMs also determine how much pharmacies are reimbursed for medications — and it isn't much. The same OSPA report also found that for every 100 prescriptions, 75 claims dispensed were insufficient to cover the pharmacy labor cost and drugs due to PBM practices. The study found that PBMs appear to reward and encourage higher drug prices. OSPA's report also uncovered significant disparities between the amount pharmacies are reimbursed in disadvantaged communities, like those in rural Oregon, and the broader pharmacy market.

If the closure of independent pharmacies continues, rural communities would lose a substantial source of economic activity, jobs and local spending from employees. For communities that have not seen job numbers climb since 2001, independent pharmacy closures signal even greater hardship ahead.

Independent pharmacists have always been an alternative for those who want an individualized and personal relationship with their health care providers. Local pharmacists are trusted professionals around the corner, available at any time without an appointment, and they fill a crucial role in our communities.

Both state and federal legislation is needed to curb PBM practices that harm Oregon patients and small businesses alike. Sens. Ron Wyden and Jeff Merkley should support federal attempts to rein in PBMs, and Sen. Deb Patterson and Rep. Rob Nosse, who lead our state Legislature's health committees, should introduce new legislation to shine a light on how PBMs operate in Oregon and reel in their economy-dampening activities.

If you're wondering if there will be a pharmacy in your town next year, the answer is likely "no." Independent pharmacies are essential to our communities, and we must take steps to reduce the impact they face from PBMs.

Mike Millard is professor emeritus at Pacific University and the 2021 Oregon State Pharmacy Association Pharmacist of the Year. His practice and research focuses on pharmacy law, management and leadership.

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