The bill aims to change the landscape of how pharmacy benefit managers interact with health plans. It introduces requirements for PBMs to report on the rebates and other financial arrangements they have with drug manufacturers, ensuring that such funds go directly to the health plans and ultimately to members. By enforcing full rebate pass-through from PBMs to health plans, the legislation seeks to lower overall prescription drug costs for patients. The bill also establishes penalties for non-compliance, thereby promoting accountability among pharmacy benefit managers.
Summary
SB1339, titled the ‘Pharmacy Benefit Manager Reform Act’, is designed to increase oversight over pharmacy benefit management (PBM) services provided on behalf of group health plans and health insurance coverage. The bill mandates that starting from January 1, 2025, any entity providing these services must allow transparency in their contracts. This means they cannot restrict the disclosure of information that is vital for plan sponsors, thus enabling better reporting and evaluation of pharmacy benefit services delivered to enrollees.
Sentiment
The sentiment surrounding SB1339 is largely positive from consumer advocacy groups and many legislators who believe that increased transparency is key to reducing prescription drug costs. Supporters argue that by holding PBMs accountable, the bill will help mitigate rising healthcare costs faced by consumers. However, some stakeholders express concern that the bill could disrupt current market practices and create unforeseen complications in drug pricing mechanisms.
Contention
Notable points of contention include the balance of power between pharmaceutical manufacturers, PBMs, and healthcare providers. While proponents assert that the reforms will protect consumers and enhance the competitive landscape, critics warn that overly stringent regulations may stifle innovation and lead to increased costs in other areas. The bill also delves into the relationship between PBMs and pharmacies, which some fear could be negatively impacted if PBMs are forced to pass through all their savings in the form of rebates.
To amend title XVIII of the Social Security Act to ensure fair assessment of pharmacy performance and quality under Medicare part D, and for other purposes.