The legal landscape for patient support services

March 18, 2021
Nicholas Saraceno

Pharmaceutical Commerce, Pharmaceutical Commerce - March 2021, Volume 16, Issue 1

More leverage for community-based pharmacies and rules changes for drug-pricing reporting

Generally speaking, patient support services encompass a plethora of offerings, such as manufacturer-sponsored patient outreach, patient assistance and specialty pharma services, to name a few. Impacting these areas are continuously evolving legal developments in the biopharma and healthcare spaces, which uncover new trends and contribute to new approaches in compliance and transactional matters.

This past December, for example, the US Supreme Court issued its ruling in Rutledge v. Pharmaceutical Care Management Association (PCMA), deciding in favor of the interests of community pharmacies, unanimously (8-0). These pharmacies had been fighting for several years to regulate pharmacy benefit managers (PBMs)—the middlemen that handle the prescription drug benefits for health insurers, large employers and Medicare Part D drug plans, among others.

As reported by Pharmaceutical Commerce, the High Court investigated the degree to which the federal Employee Retirement Income Security Act of 1974 (ERISA), which standardizes private employee benefit plans, prevents states from regulating the amount that PBMs pay pharmacies to distribute prescription drugs that are covered by an employer-sponsored health plan.

Simone Colgan Dunlap, a partner at Quarles & Brady LLP’s Phoenix branch, points out that the PBM lobby has been successful in using ERISA to strike down unfavorable state laws, and this recent ruling could push pharma lobbyists to test the limits of the decision.

“ERISA preemption has historically been an effective tool for striking down state laws that regulate PBM activity,” says Dunlap. “I predict that the Rutledge decision will encourage states and pharmacy lobbyists to try to enact laws similar to Arkansas’ Act 900 (the law at issue in Rutledge), and to pursue more expansive laws that push the boundaries of Rutledge. The ruling enhances a state’s ability to enact and enforce laws governing PBM activity.”

Further management of PBM authority will also allow community pharmacies to have more control of PBMs’ maximum allowable cost (MAC) lists—the maximum allowable price that a plan will pay for generic drugs, along with brand drugs that have generic alternatives.

“Additional regulation of PBMs will generally be positive for community pharmacies that stand to benefit from laws that require PBMs to do things like update MAC lists and allow pharmacies to rebill claims when the pharmacy cannot obtain a drug at a cost that is lower than or at least equal to the MAC price,” adds Dunlap.

Later in December, the Centers for Medicare & Medicaid Services (CMS) made changes to Medicaid prescription drug pricing, an announcement that would also impact the day-to-day of PBMs. CMS issued a final rule related to cost-sharing assistance, including co-payment assistance cards.

“The new rules make clear that if the discounts are not benefiting the patient and instead lower the costs for health insurance companies and theirs [PBMs], they must be counted in drug manufacturers’ reporting to CMS for Medicaid rebate purposes, as required by law,” says Maria Kirsch, SVP and head of patient services operations at Eversana, a life sciences commercial services company. “CMS is delaying the effective date of this policy until Jan. 1, 2023, to give manufacturers and payers time to make any necessary changes to their patient assistance programs and reporting mechanisms.”

In response to this ruling, Kirsch says that Eversana is currently forming solutions aimed toward direct-to-patient (DTP) mechanisms to guarantee compliance, including a smart enrollment tool that assesses product affordability based on detection of formulary design, such as redirection to a cash program and using alternative reimbursement methods.

Staying focused on the big picture

Community pharmacies are integral patient-support providers, but sometimes, experts observe, these pharmacists can find themselves getting caught up in the details surrounding rules and regulations. A recent American Association of Colleges of Pharmacy article describes just that, even with, as authors Athena Ponushis and Nidhi Gandhi, PharmD, note, community pharmacists anticipating their focus increasingly shifting from dispensing to offering convenient clinical care.

In the article, Jennifer Adams, PharmD, EdD, associate dean for academic affairs, director of interprofessional education, and clinical associate professor at Idaho State University College of Pharmacy, is quoted: “What our board of pharmacy learned from our healthcare colleagues was, pardon the pun, but pharmacists tend to be really prescriptive in their regulations. We write out the exact details of how hot the water in the pharmacy needs to be, the amount of counter space that needs to be provided; we get way into the weeds, rather than saying the facility needs to be appropriate so that the practitioners in the facility can provide the appropriate standard of care.”

Covid-19 impact

The ongoing pandemic has caused healthcare providers (HCPs) to shift and adapt to a new future—one in which telehealth is a go-to option. For this to be possible, however, it has required a collaborative effort on behalf of multiple tiers of government, involving revisions to their modes of compliance. “States and federal government—along with regulatory bodies—really took notice of the challenges and began rethinking some of the more restrictive guidelines that were preventing people from having access to much needed care during these times,” says Steve Gransden, SVP of strategy and commercial planning for KnippeRx Inc., an independent specialty pharmacy. “One of the prominent areas of realignment has been taking place within telehealth—some reevaluating of the guidelines has made healthcare far more accessible to those people who are highly restricted.”

Dunlap notes that early legal-support efforts were prioritized toward helping clients digest and react to new guidance and regulations in the form of waivers, state of emergency declarations, emergency board guidance and instituting measures to ensure continuity of patient care and protection of pharmacy staff.

“After that, there was a return to focus on more ‘normal’ topics like [usual and customary] pricing reporting, licensing, compliantly engaging with pharmaceutical manufacturers and shared services arrangements,” she says.

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