Dave Yost remains stumped. The state attorney general explained at a news conference on Monday that he isn’t sure how much money pharmacy benefit managers make from the state programs with which they contract. The uncertainty persists though as state auditor and in his current position he has examined these middle men who negotiate drug prices on behalf of Medicaid recipients, state retirees and others. Thus, he makes a strong case for adding transparency and accountability to the relationship.

State officials must be in a position to track the public dollars.

The concept of pharmacy benefit managers sounds reasonable. Advocates talk about providing a check against the power of drug manufacturers to set and raise prices for prescription medicine. Ideally, PBMs drive down costs, the savings gained for the state and taxpayers. No surprise that pharmacy benefit managers collect a fee for their work. The concern is the state doesn’t have the tools to protect against abuse, such as benefit managers padding their bottom lines.

In August, as state auditor, Yost presented an analysis that found pharmacy benefit managers collected $208 million, or nearly one-third, of the $663 million the state’s Medicaid managed care companies spent on generic drugs during a year’s time. In March, as attorney general, he took one of those benefit managers, OptumRX, to court, accusing the company of failing to pass along guaranteed discounts, overcharging the state by $15.8 million.

At the time he filed the lawsuit, Yost declared, “Our review of PBM practices throughout state government is still ongoing. These are the first raindrops, but there’s a storm a-coming’.”

To enhance any review going forward, Yost proposes a set of four steps. One would grant the state auditor broad authority to examine all pharmacy benefit manager contracts, purchases and payments, plus evaluate legal compliance. Another step would prohibit non-disclosure agreements involving drug pricing. In that way, pharmacy benefit managers no longer could keep pharmacists from informing customers about less expensive drug options.

The third step would require pharmacy benefit managers to sign fiduciary agreements with the state. Yost noted that currently benefit managers argue they do not have such an obligation. Yet as the attorney general pointed out, that is what the benefit managers pitch, pledging to gain the best deal for the state, or their customer. So this element would mandate they keep their word to put first the interests of the state.

Finally, the attorney general proposes the state create a single contract for pharmacy benefit managers, streamlining a process that now involves multiple contracts with various state offices. Yost described this element as an “aspirational goal” in light of the likely resistance from the many public players. At the same time, it would be an improvement, particularly with Medicaid and its arrangement with managed care companies. It would advance clarity and oversight.

These steps simply are sensible. State offices purchase all manner of goods, and state lawmakers, along with elected officials, have ready access to the details. So it should be with pharmacy benefit managers, the need all the more significant given the high cost of prescription drugs and the strain that places on budgets, public and private.

To its credit, the state has begun to move forward, since reporting by the Columbus Dispatch the past year put the matter front and center. For instance, the state Department of Medicaid has adopted “pass through pricing,” which yields pertinent data and makes things less opaque. Lawmakers are talking about taking action in the new state budget. They would do well to include the steps proposed by the attorney general, achieving the dose of transparency and accountability the public deserves.