Capitol Roundup: AG initiates review to bring transparency to Rx pricing

By Bill O’Boyle - [email protected]
DePasquale -

WILKES-BARRE — Auditor General Eugene DePasquale this week said he is launching a review to bring transparency and accountability to prescription drug pricing in Pennsylvania.

The result will be a special report focused on practices by pharmacy benefit managers (PBMs), which negotiate with drug companies and insurers to help define which drugs are covered by health insurance plans and set the drug reimbursement rates for community and chain pharmacies.

“States across the country are struggling with this issue because there currently is no state or federal oversight of these pharmacy benefit managers,” DePasquale said during a news conference at the Capitol. “Taxpayers and businesses deserve more transparency in the pricing of prescription reimbursements than is currently required, and I want to fix that.”

There are four major pharmacy benefit managers in Pennsylvania — CVS/Caremark, Perform Rx, Optum Rx and ESI. They receive state and federal funding through subcontracts originated in the Department of Human Services (DHS) and paid for through Medicaid. DHS contracts with health insurance companies, called managed care organizations (MCOs); the MCOs contract with PBMs.

“My office is in the best position to review the impact PBMs have on hundreds of thousands of Pennsylvanians,” DePasquale said.

His team will look into these questions:

• How much does the state spend on pharmacy benefit managers?

• How do pharmacy benefit managers bill insurance companies for a drug?

• How do PBMs determine the drug reimbursement rate for pharmacies and are those rates consistent across different types of pharmacies?

• Do PBMs pass along savings from rebates and price cuts they get from drug manufacturers?

• Why is drug pricing information kept private when taxpayers are footing the bill?

• What is the Department of Human Services is doing about contracts that involve pharmacy benefit managers?

• Are any Pennsylvania pharmacies are subject to gag orders?

• How can Pennsylvania can ensure transparency and fairness in pharmacy pricing for consumers?

“I want to make sure that consumers always know how to receive the best price possible for the prescriptions they need,” DePasquale said.

DePasquale plans to hold regional hearings and invite local pharmacists, pharmacy benefit managers, health insurance companies and health care providers to discuss how best to resolve this complicated issue.

Marino helps introduce

bipartisan Safe Home Act

U.S. Rep. Tom Marino, R-Lycoming Township, and Rep. Jim Langevin, D-Rhode Island, introduced bipartisan legislation this week to protect adopted children from being “rehomed.”

The Safe Home Act would close a loophole in existing federal law by clarifying the abandonment of an adopted child with a stranger, known as re-homing, is a form of child abuse.

Reuters brought national attention to re-homing in 2013, when it published an investigative series on adoptive parents who use Internet forums to advertise children they wish to abandon. Transferring custody outside of legal adoption practices often places children at risk for neglect, exploitation, or even sexual abuse. However, state child welfare authorities have reported they are unsure if they can investigate re-homing cases because re-homing is not explicitly defined as a form of child abuse.

The Safe Home Act adds re-homing to the federal definition of child abuse and neglect under the Child Abuse Prevention and Treatment Act (CAPTA), reducing legal ambiguity and allowing states to use federal funds to counter the practice. The bill protects a parent’s ability to place their children with a trusted relative when appropriate but ensures they cannot transfer custody to a stranger without oversight.

“As the father of two adopted children, I can think of nothing more important than making sure minors in the child welfare system are protected,” Marino said. “By classifying re-homing as a form of child abuse, The Safe Home Act gives our nation’s child welfare authorities what they need to investigate these cases. This is a common-sense piece of legislation and I look forward to working with my colleagues to move this bill forward.”

DEP reminds homeowners

about mine subsidence risks

Pennsylvania homeowners have new tools at their disposal to identify risks and insure their property from underground mine subsidence, thanks to a newly revamped website from the Department of Environmental Protection.

The new website — — contains information about known underground mine locations and possible risks for subsidence. Recently updated maps show historic mining and known coal-bearing areas that could be affected by mine subsidence from old and abandoned mines.

“Underground mining has a long history in Pennsylvania, and historic mines can still cause subsidence today,” said DEP Secretary Patrick McDonnell. “I encourage all Pennsylvanians to log on and see what their risk is, and to sign up for mine subsidence insurance if needed.”

Cracked foundations, collapsed walls, and even homes sinking into the ground are all possible impacts of underground mine subsidence, which is not typically covered by homeowner’s insurance. Mine subsidence occurs when the ground above an old or abandoned mine cavity collapses.

“DEP is continuously improving our maps and data for underground mining,” said McDonnell. “Our goal is to have the best underground mine mapping easily accessible to anyone who wants to view it, so that residents can know if they could be affected and can easily sign up for Mine Subsidence Insurance if they need it.”

DEP administers low-cost mine subsidence insurance (MSI) coverage through the state. The average policy of $160,000 costs about $7 a month, and senior citizens are eligible for discounted rates.

New Pa. board focused

on agricultural education

In recognition of the growing need for a workforce prepared to fill nearly 75,000 job vacancies in the agriculture and food industries over the next decade, the Pennsylvania Departments of Agriculture (PDA) and Education (PDE) this week unveiled their comprehensive agricultural education report for schools across the commonwealth.

“The Wolf Administration believes in prioritizing jobs that pay and schools that teach, and this report represents the intersection of those two priorities,” said Agriculture Secretary Russell Redding. “Ensuring that Pennsylvania’s students have access to high-quality agricultural education programs that foster the skills necessary for success will lay the groundwork for a talented, well-prepared workforce in the years to come.”

The report announcement was accompanied by the creation of a 15-member Commission for Agricultural Education Excellence.

“Farming isn’t the only agriculture-related career pathway,” Education Secretary Pedro A. Rivera said. “Other careers include engineering and design, law, finance, environmental planning, and sales – at its heart, agriculture education is STEM education. Promoting agriculture education is an investment in the next generation of leaders of Pennsylvania’s top industry.”

Agriculture is a $135 billion industry facing an aging workforce. Attrition, growing demand for certain products, and advancing technologies will result in a workforce deficit in a number of career paths over the next decade.


By Bill O’Boyle

[email protected]

Reach Bill O’Boyle at 570-991-6118 or on Twitter @TLBillOBoyle.

Reach Bill O’Boyle at 570-991-6118 or on Twitter @TLBillOBoyle.