Legislative Updates

Topic

Brief Description

Supreme Court Rules in Favor of Pharmacists, Patients

Decision in Rutledge v. PCMA Validates State Efforts to Rein in PBMs

The Supreme Court of the United States issued on December 10, 2020 its landmark decision in Rutledge v. Pharmaceutical Care Management Association (PCMA), ruling in favor of an Arkansas law to prevent abusive PBM payment practices. 

The unanimous (8 to 0) decision ruled in favor of the interests of patients and community pharmacies, who have been fighting for years to regulate pharmacy benefit managers (PBMs), the controversial middlemen that manage prescription drug benefits for health insurers, Medicare Part D drug plans, and large employers. With this ruling, states will have greater authority to protect their local businesses and their patients from PBM overreach.

The Arkansas law upheld by the Supreme court prohibits PBMs from reimbursing local pharmacies at a lower rate than what the pharmacies pay to fill prescriptions. PBMs often profit by reimbursing pharmacies at less than a pharmacy’s cost to acquire a drug. This is just one of the many ways the PBM system puts pharmacies and patients at a disadvantage.