Investor Presentaiton
OREGON
SOS
OREGON
AUDITS
DIVISION
Shemia Fagan Secretary of State
Cheryl Myers Deputy Secretary of State, Tribal Liaison
Kip Memmott MA, CGAP, CRMA Audits Director
February 6, 2023
House Committee on Behavioral Health and Health Care
Oregon Legislature
900 Court St. NE
Salem, OR 97301
Dear Chair Nosse and Vice-Chairs Goodwin and Nelson:
We are providing information about leading practices related to Pharmacy Benefit Manager (PBM)
transparency reporting requirements. We are providing this information now because the Oregon
Legislature is considering legislation on this topic, and our audit of Medicaid PBMs will be released after
legislative deadlines elapse. Such practice is in accordance with Government Auditing Standards:
"To be of maximum use, providing relevant evidence in time to respond to officials of the audited
entity, legislative officials, and other users' legitimate needs is the auditors' goal... During the audit, the
auditors may provide interim reports of significant matters to appropriate entity and oversight officials.
Such communication alerts officials to matters needing immediate attention and allows them to take
corrective action before the final report is completed."¹
Increased transparency
Reporting requirements
Policymakers across the country are taking a multifaceted approach in tackling rising prescription drug
costs. One area that has received national attention in the past few years is the part PBMs play in
health care. PBMs play a key role in the complex pharmacy process and can provide a wide array of
services, such as processing claims, performing drug utilization review, creating formularies, and
negotiating contracts between health plans, manufacturers, and pharmacies. Over time, their roles and
responsibilities have changed from mostly claims adjudication to having significant influence over many
aspects of the prescription drug system.
A lack of transparency in PBM processes has led many states to implement laws requiring PBMs to
disclose certain pricing and cost information, such as data on rebates or payments and fees collected
from drug manufacturers and pharmacies. PBM reporting requirements have been established in 16
states, as shown in Figure 1.
1 U.S. Government Accountability Office, Yellow Book Generally Accepted Government Auditing Standards 9.17
255 Capitol St. NE Suite 180
Salem OR 97310
(503) 986-2255
sos.oregon.gov/auditsView entire presentation