An Act to Improve Accountability and Understanding of Data in Insurance Transactions
If enacted, LD1906 will significantly impact state laws governing healthcare and insurance transactions. It will require PBMs and administrators to provide specific data upon request, including itemized billing statements and medical records associated with claims. The legislation also emphasizes the plan sponsor's right to conduct audits, thereby shifting some control back to employers and self-funded plans, which may lead to increased scrutiny of PBM practices and potentially lower costs for plan sponsors and beneficiaries.
Bill LD1906, titled 'An Act to Improve Accountability and Understanding of Data in Insurance Transactions,' aims to enhance the transparency and accountability of pharmacy benefits managers (PBMs) and administrators in the handling of healthcare claims. The bill mandates that any contract between a plan sponsor and an administrator must provide the plan sponsor with ownership of claims data. It establishes a framework where plan sponsors can request detailed claims information and audits to ensure compliance with contractual agreements, particularly focusing on high-cost claims that exceed $50,000.
The sentiment surrounding LD1906 appears generally supportive among those advocating for greater accountability and transparency in healthcare transactions. Proponents argue that the bill will empower plan sponsors to better manage their healthcare expenditures and ensure that they receive the full benefit from their contracts with PBMs. However, there are concerns expressed by PBMs and some industry stakeholders regarding the possible administrative burden and the impact of increased auditing on their operations.
One notable point of contention regarding LD1906 centers around the balance between necessary oversight and the operational flexibility of pharmacy benefits managers. Critics of the bill argue that the extensive auditing rights granted to plan sponsors could lead to excessive administrative work and create obstacles for efficient claims processing. There are fears that such regulations could discourage competition among PBMs, thus potentially leading to higher costs in the long run, undermining the very goals of improved accountability and reduced costs.