The country's highest court has asked the U.S. solicitor general to weigh in on whether the court should grant Arkansas' request to review an appeals court decision upholding limits on the state's regulation of companies that pay pharmacies on behalf of health plans.
Arkansas Attorney General Leslie Rutledge in October asked the U.S. Supreme Court to review the 8th U.S. Circuit Court of Appeals' June decision on a challenge to a 2015 state law regulating the reimbursement rates of the companies, known as pharmacy benefit managers.
Agreeing with U.S. District Judge Brian Miller, the appeals court found that the law doesn't apply to drug claims paid by employer-sponsored plans that are regulated by the U.S. Department of Labor.
In the case of those plans, in which the employer, rather than an insurance company, provides the money to pay employees' health care expenses, the state law is pre-empted by the federal Employee Retirement Income Security Act of 1974, the appeals court found.
Rutledge argued that the decisions by Miller and the appeals court conflict with earlier rulings by the Supreme Court, which she said found that the federal law doesn't bar states from regulating reimbursement rates.
In November, 31 states and Washington, D.C., filed a brief in support of Rutledge's request for review, saying decisions in the case have created "confusion and uncertainty regarding States' power to regulate" pharmacy benefit managers.
The Supreme Court hasn't yet decided whether to take up the case, but on Monday it invited Solicitor General Noel Francisco to file a brief "expressing the views of the United States."
Rutledge is "pleased that the U.S. Supreme Court has requested the U.S. Solicitor General's views on this important case," spokesman Amanda Priest said in an email Wednesday. "Small, independent and rural pharmacies around the country are closing at an alarming rate in part due to the unfair reimbursement practices of pharmacy benefit managers."
The Supreme Court's request for input is a "positive sign" that it will take up the case, said Andie Pivarunas, a spokesman for National Community Pharmacists Association, which supports regulation of pharmacy benefit managers.
The case stems from a lawsuit filed by the Pharmaceutical Care Management Association, which represents pharmacy benefit managers.
Since 2015, Arkansas has passed other laws regulating pharmacy benefit managers. For instance, Act 994, signed by Gov. Asa Hutchinson on Monday, prohibits certain tactics used by the companies to recoup payments to pharmacies.
It also prohibits pharmacy benefit managers from earning profits by charging health plans more than the companies pay pharmacies for the same drugs.
Priest said Act 994 "addressed a range of different issues than what is included in the petition before the Supreme Court."
Metro on 04/18/2019