TN House Advances PBM Bill

The Tennessee State House on Tuesday advanced a bill that has ruffled the feathers of the large pharmacy chain CVS. House Bill 1959, prohibits pharmacy benefit managers or PBMs from owning or controlling a pharmacy in the state of Tennessee.

PBMs manage the prescription benefit programs for many insurance providers, including those who get their insurance through their employer. One such PBM is Caremark, which is owned by CVS. Proponents of the Tennessee bill and one like it in the US House, point out that customers pay the price for the PBMs and pharmacy partnership. It is estimated that the top three PBMs (CVS Caremark, Cigna Express Scripts, and UnitedHealth Group’s Optum Rx) control 80% of the prescription drug market, steering business to their preferred pharmacies, which creates a conflict of interest. Small independent pharmacies are at a severe disadvantage in that setup.

CVS has threatened to close over 130 locations that they operate in Tennessee if the bill passes. One of those locations is in Newport. CVS has launched a campaign urging their customers to contact their state representative to vote the legislation down. However, this week, The Tennessee House Finance, Ways, and Means Committee advanced the bill. The bill will now be heard by the Senate Finance, Ways, and Means Committee on March 24.

If you get your prescription coverage through your employer or a government agency, you will want to follow this story very closely.