Rutledge v PCMA arguments: Thumbs up or thumbs down?

For today’s blog, I invited Ilisa Bernstein, APhA’s senior vice president for pharmacy practice and government affairs, to share her thoughts on this week’s big Supreme Court case from her perspective as both a pharmacist and a lawyer. 

By Ilisa Bernstein

Finally, oral arguments in Rutledge v PCMA were heard this week. The pharmacy community has been eagerly awaiting the showdown at the U.S. Supreme Court on this case involving the state of Arkansas against the Pharmaceutical Care Management Association, the association representing pharmacy benefit managers (PBMs). 

This case is pivotal to curbing the abusive practices of PBMs across the country. The legal question involves ERISA, which is the Employee Retirement Income Security Act of 1974. ERISA is intended to provide nationwide, consistent standards and requirements for employee retirement and health plans by preempting (or preventing) states from passing laws and regulations affecting employee retirement and health plans. The question for the Supreme Court is whether ERISA’s broad preemption extends to state laws covering the dealings between PBMs and pharmacies. 

All eight current justices heard the case by telephone, and the audio was broadcasted live. It was all very orderly. Arkansas gave brief opening remarks, and then the justices each had 3 minutes or so to ask questions. 

Next, supporting Arkansas, the U.S. Solicitor General’s office (representing the U.S. government) made a brief statement and then responded to questions. PCMA’s lawyer, who is a former Solicitor General, then had 30 minutes or so to answer questions. Finally, Arkansas was given time for a rebuttal to express any last points that weren’t made previously and answer any last questions. 

Arkansas and the government argued that existing Supreme Court precedent law in a 1995 ERISA preemption case (referred to several times in the arguments as “Travelers”) should be followed here. Many of the justices’ questions were attempts to tease away similarities and differences between this case. The primary focus on both sides was whether the Arkansas law related to plan administration and benefits, which would be preempted, or if it was outside that scope. Arkansas argues that its law governs the dealings between PBMs and pharmacies, which is related to reimbursement, and not to administration of the plan—and thus, is not preempted. 

Listening to the questions and answers, it was difficult to predict where the justices might rule. Some were more obvious based on their softball questions, but others were harder to read. Without any video, there was no opportunity to see body language. And, because of the orderly approach to the Q&A, there wasn’t the typical interrupting or maneuvering to get a question in from the justices. They all had an equal opportunity to speak, with equal time for each. 

Five justices must side with Arkansas for Team Pharmacy to prevail. Tiffany Wright, a litigation expert who clerked with a Supreme Court justice and a Circuit Court judge, believes that five of the justices may side with Arkansas based on their rulings in similar cases and other writings. Her analysis can be heard in the post-case video debrief conversation with the APhA, NCPA, APA, and NASPA CEOs. She believes Justices Thomas, Gorsuch, Kavanaugh, Sotomayor, and Kagan will side with Arkansas. The precedent and information in the record in this case are strong, and our amicus brief, submitted with our pharmacy partners, is a good read in evidence of that strength.  

The decision likely will not be issued until spring 2021.

My assessment: THUMBS UP for Team Pharmacy!!!

Ilisa Bernstein, PharmD, JD, FAPhA
Senior Vice President for Pharmacy Practice and Government Affairs