PBM Reform Momentum Builds as States Challenge Industry Practices
There have been major developments when it comes to PBM policy in states across the country this year. Here are a few highlights.
States Target Pharmacy Benefit Managers (Legislative Update)
Arkansas Faces Third Lawsuit Over PBM Law
A third lawsuit challenging Arkansas’s new state law prohibiting pharmacy benefit managers (PBMs) from owning pharmacies has been filed. This latest suit, brought by the PBM trade group Pharmaceutical Care Management Association (PCMA), seeks to overturn Arkansas Act 624 in federal court. It follows similar lawsuits filed by CVS and Express Scripts.
Louisiana's Last-Minute Legislative Reversal
Louisiana's HB 358, which prohibits PBMs from owning pharmacies, was scrapped in the final hour of the legislative session in favor of a study bill. The provision was a late addition, appearing in the conference committee report the day before the session concluded. The evening before the session ended, many Louisiana residents received text messages opposing the bill and urging them to contact their legislators. Attorney General Liz Murrell (R) announced an investigation into whether CVS improperly used personal information for these messages. Governor Landry (R), who previously sued CVS Caremark as Louisiana Attorney General, expressed strong support for the bill and is considering calling a special session to revisit the bill.
California and Illinois Address Spread Pricing
California and Illinois are both considering PBM reform to address significant budget deficits, viewing it as a means to save money. Both states have introduced legislation to prohibit spread pricing, a practice where PBMs charge insurers one price but reimburse pharmacies less, retaining the difference. California's SB 41 and Illinois' HB 1697 include this prohibition, with the expectation that applying it to state-sponsored health plans will generate savings. Additionally, both bills mandate that PBMs pass through all rebates to either the plan sponsor or the covered individual, again hopefully saving money on state-sponsored health plans. Although California Governor Newsom (D) vetoed nearly identical legislation earlier this year, he has indicated that he will sign this bill if it comes to his desk. In Illinois, the bill was passed by both chambers on May 31st. Governor Pritzker (D) has until July 30th to sign or veto the bill, and he has indicated he will sign it.
Track Health Care Policy
The ever-evolving state health policy landscape will continue to influence how health care organizations make business decisions. MultiState's team pulls from decades of expertise to help you effectively navigate and engage. MultiState's team understands the issues, knows the key players and organizations, and we harness that expertise to help our clients effectively navigate and engage on their policy priorities. We offer customized strategic solutions to help you develop and execute a proactive multistate agenda focused on your company's goals. Learn more about our Health Care Policy Practice.