New York Requests Public Comments Regarding PBM Patient-Steering

Pharmacy Benefit Managers (PBMs) manage pharmacy networks on behalf of health insurers, self-insured employers and other payors, while also owning or affiliating with pharmacies. PBMs have been under scrutiny from both federal and state lawmakers amid questions about whether they are engaging in anti-competitive practices. Recently, the Federal Trade Commission (FTC) announced it was seeking public comment on PBM practices including the "PBMs' use of methods to steer patients away from unaffiliated pharmacies and methods of distribution and toward PBM-affiliated specialty, mail-order, and retail pharmacies."

In New York, the Department establishes the minimum standards for the issuance of a license to operate a PBM in the state. In the request for public comments, New York seeks feedback on the implementation of potential rules related to patient-steering that address the following topics:

• mandatory specified pharmacy use, including mail order, specialty, and retail pharmacies (commonly referred to as "preferred pharmacies");
• correspondence from PBMs to consumers/insured individuals/patients to encourage mail order or other specified pharmacy use;
• restrictions on services (such as delivery or packaging services) provided by network pharmacies;
• restrictions on access to certain in-network pharmacies, and processes for approval of the use of a patient's pharmacy of choice;
• differences in quantity limits, days' supply limits, or cost sharing for the patient (copay or coinsurance) between different pharmacies within a PBM network; and
• restrictions or thresholds on the dispensing of certain medications or National Drug Codes (NDCs) within a network pharmacy.

Comments on these issues may be submitted to the Department via email through August 19, 2022. For further information, please contact Stephen M. Azia, Kathleen R. Salsbury, or Katherine I. Funk.