Texas Senate Bill SB1416

Texas 2009 - 81st Regular

Caption

Relating to certain contracts between pharmacy benefit managers and the Employees Retirement System of Texas, the Teacher Retirement System of Texas, The Texas A&M University System, or The University of Texas System.

Impact

The legislation aims to enhance the management of pharmacy benefit services while ensuring that state systems have detailed information about PBM practices. It requires that any contract includes provisions for therapeutic interchange, where PBMs can substitute prescribed drugs. Contracts are mandated to include disclosures about financial and medical criteria for drug formulary changes and to identify specific specialty drugs, thereby increasing the visibility of PBM operations and their impact on drug costs.

Summary

SB1416 addresses regulations concerning contracts between pharmacy benefit managers (PBMs) and various state agencies, including the Employees Retirement System of Texas and the Teacher Retirement System of Texas. The bill stipulates specific requirements for the contracts, emphasizing accountability and transparency regarding drug selection and pricing practices. Among the provisions, the bill allows flexibility in selecting PBMs without necessarily choosing the lowest bid, provided that the contract meets established criteria.

Contention

Proponents of SB1416 argue that these regulations will lead to better cost management and oversight of PBMs, which have been criticized for non-transparency and potential conflicts of interest. However, opponents may view the provisions as additional burdens on PBMs that could complicate operations and potentially limit patient access to medications due to stricter guidelines on therapeutic interchange and contractual obligations. The balance between fiscal responsibility and ensuring sufficient access to medications may lead to ongoing discussions among stakeholders.