A coalition of Tennessee lawmakers, including Republican leaders in the state House and Senate, is sponsoring legislation to rein in what it sees as unfair business practices by companies such as health care giant CVS.
At the same time, CVS warned in a press release that the legislation, House Bill 1959/Senate Bill 2040, “threatens pharmacy access for patients” by forcing it to close all Tennessee pharmacies and eliminate 2,000 jobs.
The bill bans a pharmacy company from also owning a pharmacy benefit manager, which negotiates drug reimbursement rates between insurance companies and pharmacies, essentially serving as a middleman. The legislation is sponsored by state Sen. Bobby Harshbarger, a Kingsport Republican, and state Rep. Rick Scarbrough, an Oak Ridge Republican.
“I think that’s fearmongering, or even as far as misinformation,” Harshbarger said. “This bill says you have to divest. Divestment does not equal closure. The fact that if they were to, in a worst-case scenario, decide to close, that would be a corporate business decision, not because of this bill.”
CVS is a target of the legislation because the company’s structure is commonly referred to as vertical integration, a situation in which it owns a health insurance company (Aetna), a pharmacy benefit manager (CVS Caremark) and pharmacies.