VBM abuses scrutinized by state policy think tank, U.S. Senate opens new investigation

An update was made on Aug. 16, 2024: The original version of this article was revised to further clarify the presentation to NCOIL.

Scrutinizing eyes meet vision benefit managers (VBMs) at state and federal levels alike as optometry’s concerns impress upon a state legislative think tank concurrent to the launch of a third Congressional probe.

In July, the 2024 American Legislative Exchange Council (ALEC) Meeting, a national forum for state legislators to draft and share model legislation, featured a presentation from the AOA’s State Government Relations Center (SGRC) staff and volunteers about VBM-dictated policies that infringe upon the doctor-patient relationship, harming both consumers and optometry practices.

In a 20-minute presentation to ALEC’s Health and Human Services Task Force, optometry's advocates painted a familiar picture of relatively few yet large vertically integrated companies controlling not only business but also patient care decisions. Further, this market control and dominance creates a scenario where doctors have little choice but to sign unfavorable contracts at the risk of losing their patients or practice.

Given ALEC’s standing as a state legislative think tank, optometry’s advocates reiterated the importance of VBM legislation, already in place in some states, curbing such harmful policies as:

• Fee setting on noncovered services
• Mandating specific lab usage
• Patient steering to some in-network doctors vs. other in-network doctors
• Provider tiering based on “pay-to-play" schemes

“Patient access is threatened by the actions of VBMs when their actions put our very practices at risk,” says Tommy Lucas, O.D., representing the AOA during the ALEC task force presentation. "That’s why the AOA is taking this fight to influential groups and think tanks that participate in policymaking. It’s important for states and the AOA to engage in all aspects of advocacy, and we’ll continue to raise awareness about these issues affecting patient care to all stakeholders.”

Toward that end, optometry’s advocates met with senior staff of the National Conference of Insurance Legislators, a bipartisan state legislative organization comprised of legislators engaged with state insurance issues and committees, where they discussed many of the same issues covered in the ALEC presentation.

Third federal investigation launches into VBM policies

Concurrent to optometry’s advocacy with these state legislative think tanks, a U.S. Senate panel opened another investigation into VBM abuses.

In appropriations language, championed by Sen. Joe Manchin, D-W. Va., the U.S. Senate Appropriations Committee voiced concern “that stand-alone vision and dental insurance plans may be using ERISA preemption authorities to avoid certain state laws that protect consumers and providers from abusive practices.” The language continues: “ERISA preemption authorities were not intended to preempt state laws to prevent market manipulation, including protections against price fixing and steering enrollees to plan-owned products and services.”

Such is the case, the Senate panel demanded a briefing from federal agency officials on any reported state law violations within 90 days of enactment of the legislation.

This language aligns with the ongoing AOA and American Dental Association push to prevent vision and dental plans from inappropriately sidestepping state-level laws by claiming federal preemption of laws on the books at the state level aimed at addressing anti-doctor, anti-patients VBM abuses.

⏩ Access the DOC Access Act fact sheet for more information.

This appropriations language brings the number of open, federal investigations into VBM abuses to three as VBM abuses are increasingly top of mind on Capitol Hill. Several significant developments in recent months include:

• A Government Accountability Office investigation, spurred by Reps. Cathy McMorris Rodgers, R-Wash., and Brett Guthrie, R-Ky., influential lawmakers who chair a U.S. House committee and subcommittee, respectively, with direct jurisdiction over health care issues, into VBM consolidation, market concentration and the impact on patients.
• A request for information from the FTC, at the direction of U.S. House Committee on Oversight and Accountability Chair James Comer, R-Ky., on the agency’s role in preventing unfair and harmful practices in the vision marketplace.
• Growing coalition support from patient and provider advocacy groups, as well as bipartisan and bicameral support of the Dental and Optometric Care (DOC) Access Act, H.R. 1385 / S. 1424, legislation that would curb anti-doctor, anti-patient VBM policies at a federal level.

As federal attention evolves around the outsized market impacts that PBMs wield, building off a recent Federal Trade Commission interim report detailing the “enormous power” these companies have on drug pricing and access, optometry’s advocates work to emphasize parallels in the vision benefit space.

In April, the AOA’s annual federal advocacy event, AOA on Capitol Hill, featured a special policy briefing, titled, “PBMs, VBMs and Growing Momentum for Reform at the State and National Levels,” with a panel discussion on the parallels between the two industries.

“Five years ago, nobody knew what PBMs were; they want to live in the shadows because they essentially pull money out of the system,” noted Dan Frier, Esq., a panelist with experience advocating against PBMs and VBMs. “We must battle them through state legislation, congressional hearings and federal legislation that promotes transparency and sheds light.

“The VBM industry is a bit different, but there are many analogies here, and many of the tools we’ve been able to utilize to protect patients and providers against PBMs can be applied here.”

Attend state advocacy regional meetings

The AOA SGRC Regional Advocacy Meetings are pivotal opportunities for grassroots advocates, affiliate leaders and volunteers to compare playbooks for successful statehouse strategies. Registration and housing are open for two remaining 2024 regional meetings, including:

SGRC Regional Advocacy Meeting Central
Sept. 13-14 | Dallas, Texas

SGRC Regional Advocacy Meeting Western
Oct. 4-5 | Seattle, Washington

Affiliate advocacy teams are encouraged to join the regional meeting that works with their schedules or travel plans. Visit the event pages above for registration and housing information for these highly interactive meetings.

Having issues with a VBM policy? Report difficulties or challenges with health or vision plans to stopplanabuses@aoa.org and visit the AOA’s Health and Vision Plan Advocacy page for more information about AOA’s and affiliates’ efforts.