Georgia lawmakers scrutinize pharmacy benefit managers and drug pricing

A Georgia House study committee is examining how pharmacy benefit managers, or PBMs, influence prescription drug prices and access, with independent pharmacists and industry representatives offering sharply different views.

PBMs negotiate drug prices among insurers, manufacturers and pharmacies. Independent pharmacists say the companies’ market power can put community pharmacies at a disadvantage, particularly in rural Georgia.

Hugh Chancey, a southwest Georgia pharmacist, told lawmakers about an elderly customer whose prescriptions were being moved to another pharmacy despite her objections. After the patient confirmed she wanted to remain with Chancey, he said the PBM still sent a fax ordering the prescriptions transferred.

“We’re not asking for special treatment,” Chancey told the committee. “We’re asking for a level playing field.”

Pharmacists say patient steering is one of several problems. They also cite reimbursement rates that can fall below the cost of dispensing medications, arguing those practices contribute to independent pharmacy closures.

The issue is particularly significant in rural Georgia. Five or six counties have no retail pharmacy, while in counties with fewer than 15,000 residents, independent pharmacies outnumber corporate locations by about 6-to-1.

Katie Bell, who closed Bell’s Family Pharmacy in Tate in 2024, said PBM reimbursement played a major role in the decision. She cited a case in which her pharmacy received $1.90 to dispense Lipitor, while publicly available State Health Benefit Plan data showed average payments of $46.87 to major chains for the same drug.

PBM representatives reject claims that they deliberately disadvantage independent pharmacies. Michael Power, a lobbyist for the Pharmaceutical Care Management Association, said PBMs have saved Georgia and organizations paying for health insurance “almost $30 billion over the last 10 years.”

CVS Health spokesman Phillip Blando said PBMs need a broad network that includes independent pharmacies to serve patients throughout the state. He also argued that isolated reimbursement examples do not represent the overall market.

Georgia has taken some steps to regulate PBMs. A 2025 law established a minimum dispensing fee for prescriptions under the State Health Benefit Plan. A broader reimbursement-parity measure was vetoed in 2024 over concerns about its potential cost to the state.

Committee Chairman Ron Stephens, a pharmacist and Savannah Republican, said transparency is a central concern.

“You know, whenever our own Department of Community Health … cannot get information to base decisions on from the very PBM that they’re contracting with, it’s ridiculous,” Stephens said.

The committee is also reviewing the federal 340B drug discount program, which has drawn competing claims from drug manufacturers and safety-net hospitals.

Rep. Butch Parrish, a Swainsboro Republican, said lawmakers need to sort through the conflicting information.

“There’s a lot of confusion,” Parrish said, adding that the committee hopes to “get down into the weeds” and gather enough information to make sound policy decisions.