A group of organizations representing independent pharmacies has filed a legal brief in support of Iowa's regulation of pharmacy benefit managers (PBMs), which is currently being challenged in federal court. The National Community Pharmacists Association (NCPA), the Iowa Pharmacy Association (IPA), the American Pharmacists Association (APhA), and the Independent Pharmacy Cooperative (IPC) submitted an amicus brief to the U.S. Court of Appeals for the 8th Circuit. They are urging the court to reject efforts by employer and insurance groups to overturn Senate File 383, a state law that regulates PBM practices.
The law is being defended by Iowa State Insurance Commissioner Doug Ommen after a lower district court issued an injunction preventing its enforcement. Employer and insurance organizations argue that the law is preempted by the federal Employee Retirement Income Security Act of 1974 (ERISA), which governs employee benefits plans. However, the independent pharmacy groups contend that PBMs are not employee benefits plans but administrators hired by such plans, making them subject to state regulation.
In their brief, the groups stated: “ERISA does not regulate the business practices of third-party providers that, like PBMs, sell goods and services to ERISA plans. Otherwise, ERISA would displace state laws regulating everything from doctors, accountants and lawyers, to hospitals and insurers.”
NCPA CEO B. Douglas Hoey commented on the legal challenge: “It’s a flimsy legal argument that was already unanimously rejected by the U.S. Supreme Court in 2020. Since that decision, almost every state in the country has passed or introduced some kind of PBM reform to stop their egregious practices.”
Matthew Pitlick, PharmD, BCPS with IPA added: “Iowa has the right, and the responsibility, to stop PBM tactics that close community pharmacies and harm patients. SF 383 is a common-sense check on middlemen and it’s essential to preserving access in rural Iowa where a single closure can leave an entire county without care. We’re proud to stand with NCPA, APhA, and IPC to protect patient access in Iowa.”
Michael D. Hogue, PharmD, CEO of APhA said: “Iowa’s PBM reform law is about protecting patient access to care. States must be able to defend their authority to regulate PBMs and ensure patients aren’t denied the pharmacy services they need.”
Marc Essensa, president and CEO of IPC remarked: “The Independent Pharmacy Cooperative stands firmly with our partners and patients in this critical fight. Senate File 383 represents a vital check on obscure third-party PBM practices, and not on ERISA plans directly. IPC is proud to join this amicus brief in support of our independent pharmacy members and we call on the 8th Circuit to uphold Iowa's common-sense law and put patient care before PBM profits.”
More information about each organization can be found at their respective websites:
- NCPA: www.ncpa.org
- IPA: www.iarx.org
- APhA: www.pharmacist.com
- IPC: www.ipcrx.com
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