News Summary
Louisiana lawmakers, led by Governor Jeff Landry, are shifting a multi-million dollar contract from CVS to local company Liviniti, aiming to reduce the influence of pharmacy benefit managers (PBMs) in the state. Although the proposed ban on PBM ownership failed, lawmakers are intensifying scrutiny of these entities amid rising drug costs. The transition highlights a push for local business support and greater transparency in PBM practices. Concurrently, Attorney General Liz Murrill has filed lawsuits against CVS for alleged unfair practices, reflecting ongoing concerns surrounding the healthcare market dynamics in Louisiana.
Louisiana – Louisiana lawmakers, backed by Governor Jeff Landry, are taking decisive action to limit the control of pharmacy benefit managers (PBMs) like CVS Health in the state’s prescription drug market. In a significant move, state officials are transferring a key multi-million dollar contract from CVS to a local company, Liviniti, reflecting ongoing concerns about the influence of large corporations in healthcare.
Governor Landry’s initiative aimed to prevent PBMs, such as CVS, from owning pharmacies in Louisiana. Although a proposed ban on such ownership failed to pass in the state legislature, discussions surrounding PBM operations and their impact on the market continue to gain traction. Lawmakers are now focusing on scrutinizing PBMs in light of rising drug costs and their perceived conflicts of interest.
The shift in contracts comes after CVS launched an extensive lobbying campaign to rally support against the proposed legislation, warning that the adjustments could lead to the closure of over 100 pharmacies statewide. Despite these warnings, the state has chosen to proceed with the transition of most PBM services to Liviniti, which is scheduled for implementation for the state’s health plan members next year. Meanwhile, a CVS subsidiary, SilverScript, will be responsible for servicing certain retirees under a separate agreement.
The value of the Liviniti contract is estimated at $749 million, whereas the SilverScript agreement amounts to $399 million. State lawmakers believe these new contracts will foster opportunities for independent pharmacies struggling in the current market. This decision highlights a growing trend of prioritizing local businesses against the backdrop of large corporate interests.
Additionally, Attorney General Liz Murrill has filed three lawsuits against CVS, accusing the company of engaging in unfair trade practices and improperly using customer data during its lobbying efforts. One of these lawsuits specifically alleges that CVS sent politically charged text messages to customers without their consent, potentially violating HIPAA laws. In response, CVS maintains that its actions were lawful and insists that its integrated business model is ultimately beneficial to patients.
As legislation evolves, the Legislative Council in Louisiana is demanding greater transparency in PBM operations. Council members are actively gathering data to better inform future legislative decisions concerning these entities. Growing apprehensions surrounding the opacity of PBM practices stem from critics asserting that such practices contribute to escalating drug costs, prompting state representatives to push for a more transparent approach.
Despite the rejection of the initial ban on PBM ownership of pharmacies, lawmakers have indicated their intentions to further study the ramifications of vertical integration within the industry. Some legislators express concerns that the ownership model creates significant conflicts of interest, particularly when PBMs also operate retail pharmacies.
The public response to these developments suggests that independent pharmacies are optimistic about regaining a foothold in the market following the reduction of CVS’s influence over state pharmacy practices. State officials are responding to these market pressures with ongoing efforts to evaluate and amend policies governing PBMs, ensuring they align with the needs of residents and local businesses.
In summary, Louisiana’s transition from CVS to Liviniti for PBM services signals a broader push for enhancing local control in the healthcare sector and addressing concerns surrounding the practices of major pharmaceutical companies. This ongoing scrutiny and legislative evolution represent crucial steps toward a more balanced and equitable pharmaceutical market in Louisiana.
Deeper Dive: News & Info About This Topic
- Louisiana Illuminator
- NOLA.com
- Drug Topics
- Healthcare Dive
- WWLTV
- Wikipedia: Pharmacy Benefit Manager
- Google Search: Pharmacy Benefit Managers Louisiana
- Google Scholar: Louisiana Pharmacy Benefit Managers
- Encyclopedia Britannica: Pharmacy Benefit Managers
- Google News: Louisiana Pharmacy News
Author: STAFF HERE NEWORLEANS WRITER
NEW ORLEANS STAFF WRITER The NEW ORLEANS STAFF WRITER represents the experienced team at HERENewOrleans.com, your go-to source for actionable local news and information in New Orleans, Orleans Parish, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as French Quarter Festival, New Orleans Jazz & Heritage Festival, and Essence Music Festival. Our coverage extends to key organizations like the New Orleans Chamber of Commerce and Greater New Orleans, Inc., plus leading businesses in energy, healthcare, and education that power the local economy such as Entergy, Ochsner Health, and Tulane University. As part of the broader HERE network, including HEREShreveport.com, we provide comprehensive, credible insights into Louisiana's dynamic landscape.
