Op-Ed: North Carolina's health plans aren't broken. Don't fix them.
By Tina Wolfe
As a business owner, I know a thing or two about competition. Achieving success requires a sense of mission, wisdom, effective management, and – most importantly – dedicated employees.
Competing for top talent in a state like North Carolina, which has undergone a fundamental economic transformation over the last 75 years, is no easy task. The Tar Heel State was formerly famous for its agriculture and furniture industries; now, it is an innovation and technology powerhouse with the 11thmost productive economy in the nation.
To attract and incentivize top performance, I place high importance on my employees’ well-being. One way I do so is by doing everything I can to competitive health benefits.
25% of North Carolinians face a healthcare unaffordability burden, making our state worse than all but 13 states when it comes to healthcare pricing. What’s more, one-third of the state either reduced their dosage or skipped a prescription refill due to high costs.
North Carolina’s workers depend on their employers to provide significant healthcare coverage, grants, and subsidies to make ends meet. Unfortunately, some members of Congress aren’t making it easy for us to do so. They are advancing legislation that would regulate pharmacy benefit companies, which the vast majority of us depend on to keep our employees’ health plans generous, inclusive, and affordable.
Pharmacy benefit companies are private sector firms that negotiate lower prices with the drug companies. Over 275 million Americans use PBMs, meaning that each of these groups represent millions upon millions of businesses. Their size is what gives them the clout to take on the big drug companies, securing pricing discounts, rebates, and other incentives that ultimately reduce health care coverage costs. In essence, PBMs are the guardians of affordable healthcare, ensuring that patients have access to the medications they need at a price they can afford.
Studies have shown that the vast majority of the folks who use pharmacy benefit companies are happy with their invaluable services—and for good reason. They are an efficient way to reduce costs and increase the availability of needed medication.
However, as is typical in Washington, D.C., pharmacy benefit companies have become victims of their own success. The major drug companies are spending tens of millions of dollars on a massive lobbying and advertising campaign to stop them from lowering their prices. This week, the Federal Trade Commission controversially reversed its previous advocacy of PBMs all while Congress is considering a couple of measures that the drug companies would love to see pass.
Sens. Ted Budd and Thom Tillis must recognize that their own government relies on pharmacy benefit companies just as much as their state’s business leaders and workers do.
For years, officials in Raleigh have recognized the value of pharmacy benefit companies in lowering drug costs. In October 2023, the Office of the State Treasurer even announced a partnership with a PBM for state employees to reduce prescription drug costs further. In taking this action, the Treasurer said, “This is in line with our ongoing efforts to seek ways to make health care more affordable for those that teach, protect, and otherwise serve North Carolina.”
The federal government relies on pharmacy benefit companies too. They caused the government to save nearly $30 billion on Medicare Part D costs in just one year, and a 2023 Department of Labor Office of the Inspector General report found that the DOL not using them caused the department to overspend by $321.3 million.
The escalating costs of prescription drugs have become a formidable challenge for individuals, families, and businesses alike. In the tangled web of government healthcare bureaucracy, pharmacy benefit companies have emerged as the unique linchpin in the healthcare cost containment framework. In the highly competitive business environment in North Carolina, they allow small and medium-sized companies to access benefits once reserved for large corporations – which helps level the playing field.
Instead of further hampering our ability to compete, the politicians in Washington should follow the old political maxim “if it ain’t broke, don’t fix it.”
Tina Wolfe is a small business advocate and the owner of Creative Business Solutions, a small business based in North Carolina
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