In response to Gov. Andrew Cuomo’s veto of a bill that would have regulated the impact that pharmacy benefit managers have on small businesses, Levin’s Pharmacy owner Fred Rigel said he planned to take the fight to Albany.
Rigel and dozens of pharmacy owners from across the state were gearing up for a bus trip to protest Cuomo’s decision during his State of the State address on Wednesday.
“They don’t give us a fair shake as to making a living,” Rigel said of pharmacy benefit managers, or PBMs. “They’re directing everyone to the big guys. So if they want Main Street to be even more empty than it is today, this is the direction it’s going.”
PBMs act as intermediaries between pharmacies and drug manufacturers and insurance companies. A lack of oversight of PBMs comes at the expense of independent pharmacies throughout the state, which often face financial hardship because of low reimbursement rates from PBMs, which are not legally required to disclose their revenue streams in New York.
As a result, many pharmacies have gone out of business, and those still operating face obstacles. The bill would have regulated the impact that PBMs have on these businesses by forcing them to reveal their profits and obtain certain licenses, among other provisions. The legislation unanimously passed the Assembly and was then approved by the Senate, but Cuomo vetoed it on Dec. 26. It would have gone into effect 90 days after the governor signed it.
Requests for comment from Cuomo on why he vetoed the bill were not answered at press time.
PBMs first appeared in the 1980s and are largely free from government oversight. Because they can drop pharmacies from insurance networks, PBMs essentially have the power to cut off their customer base.
Assemblywoman Melissa Miller, a Republican from Atlantic Beach, called Cuomo’s decision “appalling,” while noting that both houses of the state Legislature passed the bill because “it was the right thing to do.”
“The PBMs have way too much authority and control, and they’re not being regulated the way other pharmacies are,” she said. “They’re basically systematically shutting down the smaller pharmacies, so customers are forced to use these PBMs.”
Miller said the issue hits close to home because her son, Oliver, 20, has several disabilities stemming from a stroke he suffered in utero. She noted that in the past, a medical director from a PBM overrode an order from a physician for her son’s medication, and added that she enjoys local pharmacies because they keep track of her son’s medication needs and notify her about renewals. She added that she intended to go to Albany with Rigel and other local pharmacists.
On Oct. 23, Levin’s was the site of a rally where dozens of pharmacists in white coats lined the sidewalk, several holding signs and chanting, “Hey, hey, ho, ho, PBMs have got to go!” The event, which Miller also attended, was part of a statewide protest by pharmacies across New York state at noon that day, where participants urged Cuomo to sign the legislation. Pharmacies in Nassau and Suffolk counties took part in the rally, as did many in Albany, Buffalo and other upstate areas. There was also a rally at City Hall in Manhattan.
Though the rally ultimately did not pressure Cuomo into signing the bill, Rigel said that he hoped pharmacists making their voices heard in Albany this week would help. He added that he would be going with his son, Brett, who works with him at Levin’s.
“They’re directing patients away from us,” Rigel said. “They are directing everyone to where they want to direct them to. They’re not giving patients the service that they deserve.”
Rigel has owned the pharmacy on Long Beach Road in Oceanside since 1992, and said one of his main goals was to foster a relationship with his customers and within the community. He said he was sad to see many of his competitors slash hours and staff, or go out of business. He added that even though he is not worried about closing, Cuomo’s veto could hurt him down the line.
Rigel said that in addition to his business’s future, he also worried about customers not getting the care that they need. One such customer, Suzanne Tzerman, attended the October rally and said that she was loyal to Levin’s after having many positive experiences there.
“I love Levin’s for the personal attention that they give me,” she said at the time. “They even know my name when I walk in the door. I can’t get that at any other pharmacy.”