Surviving as an independent pharmacy can be challenging. Owners and managers say pharmacy benefit management companies are taking a bite out of revenue.

“It is a challenge to deal with PBMs on a daily basis and provide the necessary care for our customers in a cost-effective manner,” said Michael Silvonek, a pharmacist at First National Pharmacy in Lehighton.

Simply put, a pharmacy benefit manager is a third-party in the management of prescription drug programs.

According to the Pennsylvania Pharmacists Association, pharmacy benefit managers were initially established to process prescription drug claims for insurance companies, but have turned into “major players in the prescription medication world.” Now, their work can encompass creating contracts with insurance companies, employers and unions to manage prescription drug programs. They also arrange for and collect rebates from drug manufacturers, create compensation formulas for pharmacy payments, establish preferred drug lists and patient co-payments.

Ben Shafer, a pharmacist at Shafer’s Pharmacy in Tamaqua, said there’s another form of PBMs, too. Several insurance companies own chain stores and/or mail-order pharmacies. For example, CVS Pharmacy and Caremark insurance united to become CVS Caremark, which is now called CVS Health. Last Sunday, CVS, the second-largest U.S. drugstore chain, announced it is buying Aetna, the third-largest health insurer, for $69 billion.

Express Scripts was formed through multiple mergers and acquisitions, and OptumRx was created by UnitedHealth Group.

According to the Pennsylvania Pharmacists Association, PBMs are Express Scripts, CVS Health and OptumRx are the three largest and encompass 78 percent of the market. Fortune 500 listed the CVS Health’s revenue as $178 billion and Express Scripts’ at $100 billion.

The Pharmaceutical Care Management Association, a national association that represents PBMs, said PBMs have helped more than 266 million Americans through their work.

“PBMs are projected to save employers, unions, government programs, and consumers $654 billion — up to 30 percent — on drug benefit costs over the next decade, according to research from Visante,” the Pharmaceutical Care Management Association stated on its website. Visante Inc. is a health care consulting firm.

The Pennsylvania Pharmacists Association said on its website that since 1987, “the total prescription drug expenditures have skyrocketed 1,010 percent and per capita expenditures have increased 756 percent.”

“They have nothing to help patients and nothing to help pharmacies,” said Ed Bechtel, a director for PPA and pharmacist at Bechtel’s Pharmacy in Slatington. “They just got in the middle an added to the administrative costs.”

“They charge huge fees for their services, which increases insurance rates for the customer,” Shafer said. “They also are constantly cutting reimbursement on the pharmacy end to increase their own profits, so every year we are making a little less on every prescription we fill.”

Leo Stanus, the manager of Shipman’s Pharmacy in Palmerton, said he doesn’t blame all PBM plans, but profitability certainly is his greatest challenge.

“Their contracts are restrictive, whereby the patient can only use certain pharmacies; patients get ‘financially handcuffed’ by their prescription plans,” he said.

For example, Stanus said, a 90-day supply of medication through a PBM’s mail order service might be $10, which could be the copay. That same 90-day supply at a local independent pharmacy might cost $30.

“These prices are put into place by the PBMs’ plans,” he said. “The retail pharmacist looks like the bad guy charging the customer $30, while the PBM plans give them a deal of $10. However, the retail pharmacy is restricted from offering that price by the PBM.”

Ed Melber, owner of Weatherly Area Community Pharmacy and Gifts and chief pharmacist, said he combats the price differences by honoring discount cards from the chains.

“CVS Care Card? We’ll take that,” he said.

Melber also said that independent pharmacists can pay closer attention to the needs of their customers, because they aren’t pressured to continually increase sales.

“I’ve had a couple people tell me I saved their lives,” he said.

Melber said one of his customers came in and looked like his color was off. He told him to go see a doctor, and it turned out to be something he needed treated.

“People can get way better service here from people they know and trust,” he said, which brings up a point that Stanus finds annoying.

Mail-order prescription plans eliminate pharmacists from the patient care equation.

“This immediately negates the pharmacist-patient relationship that can take months to build,” he said. “From our point of view, they limit the critical patient/pharmacist interaction by restricting patient access to the pharmacy.”

Silvonek said First National Pharmacy has been in his family for four generations; begun by his grandfather and in the same location on North First Street in Lehighton and for more than 80 years.

“We treat our customers as family and are always available to advise them in taking all prescriptions and over-the-counter medicines,” he said.

Similarly, Shipman’s and Shafer’s pharmacies have been serving their towns and the Carbon County area for generations.

“We have a lot of loyal customers that have been coming to us for years, and we thank them for their business,” Shafer said. “If someone is not a customer of ours, we invite them to try us and see. We think they’ll find our prices to be comparable to the big chains, and we offer much better customer service.”