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HB 7825

AN ACT RELATING TO STATE AFFAIRS AND GOVERNMENT -- OFFICE OF HEALTH AND HUMAN SERVICES

2026 Regular Session Introduced by Jennifer Boylan and 6 co-sponsors

The bill aims to curb rising drug costs in Rhode Island by increasing transparency of PBMs/MCOs, banning spread pricing, and enhancing Medicaid data, oversight, and efficiency.

05/05/2026 Committee recommended measure be held for further study
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Bill Summary · HB 7825

Bill Summary: HB 7825 (Rhode Island, 2026)

Title

AN ACT RELATING TO STATE AFFAIRS AND GOVERNMENT -- OFFICE OF HEALTH AND HUMAN SERVICES

Purpose and Intent

  • The bill aims to protect Rhode Islanders and the state Medicaid program from high prescription drug costs.
  • It seeks greater transparency and accountability for Pharmacy Benefit Managers (PBMs) and their pricing practices, particularly prohibiting spread pricing.

Key Provisions and Changes

Section 2: Amendments to 42-7.2-5 (Duties of the Secretary, EOHH S)

The act broadens the powers and duties of the Secretary of the Executive Office of Health and Human Services (EOHHS) to oversee and coordinate state health and human services, with emphasis on Medicaid and related waivers. Major areas include:

1) Oversight and Coordination
- Direct administration and financing of healthcare benefits, human services, and programs (including Medicaid under Section 1115 waiver and state plan).
- Maintains that this does not transfer traditional powers of departments to the Secretary for governance of federal/state programs.

2) Federal Relations and Policy
- Serve as governor’s chief advisor and liaison to federal policymakers on Medicaid reform.
- Review and coordinate Medicaid 1115 waiver requests, amendments to the Medicaid state plan, and related changes that affect funding, access, services, or provider payments.
- Assess legal, fiscal viability, and likely federal approvals for proposed changes.

3) Medicaid Policy and System Integration
- Lead development and implementation of Medicaid policies and systems to support integrated eligibility with HealthSource RI (the state marketplace).
- Biennial comprehensive review (since 2015) of Medicaid eligibility criteria to ensure consistency with laws, coordinate systems, improve quality and access, and identify cost-sharing opportunities.

4) Annual/Biennial Expenditure Overview
- Beginning in 2020, provide a comprehensive annual overview (due by Sept 15 each year) of Medicaid expenditures, administrative costs, and utilization.
- Include breakdowns by population, department, service type, mandatory vs. optional services, and data related to federal reporting measures to comply with federal requirements (Core Set measures for Medicaid/CHIP and related quality measures).

5) Conflict Resolution and Management
- Resolve inter-departmental conflicts and advise governor on necessary actions.

6) Internal Reforms and Efficiency
- Lead reforms to HR practices, consumer-centered service design, and resource optimization (purchasing power, centralized fiscal functions, data management, and pursuing federal funds).
- Strengthen program integrity, collections, and coordination of services; centralize legal/administrative functions; oversee protective services for vulnerable populations; rebalance long-term care services.

7) Budgeting and Planning
- Prepare integrated budgets for health and human services for consideration by the Governor and the budget office.

8) Evaluation and Data-Driven Policy
- Use objective data to evaluate policy goals, resource use, and outcomes; support long-term planning.

9) Data Integration and Health Infrastructure
- Create an integrated data-management approach to support a unified health infrastructure and consumer-centered system.

10) Independent Reviews
- Conduct independent reviews of state-administered programs when directed by the Governor or General Assembly.

11) Regular Reporting
- Provide timely reports and recommendations on Rhode Island’s health and human services agenda.

12) Staffing and Compliance
- Hire necessary personnel and contractors; ensure compliance with privacy/disclosure laws for data.

13) Sliding Scale Benefits Proposals
- Explore opportunities to remove fixed eligibility thresholds by implementing sliding-scale benefit reductions up to 450% of the federal poverty level for programs like Medicaid, childcare, and food assistance.

14) Insurer Administrative Burden
- Ensure insurers minimize burdens on providers and avoid unnecessary delays; prohibits prior authorization for admitted in-network primary care services (except for prescription drugs).

15) Federal Action Advisory Group
- Convene an advisory group to assess impacts of potential federal actions on Medicaid; develop options for administrative action or legislative consideration.

  • Advisory group composition may include state agencies, healthcare sectors, unions, and advocates.
  • Submit a report with findings and recommendations no later than Oct 31, 2025, after federal FY 2026 budget is enacted.

16) PBM/MCO Transparency and Spread Pricing
- Require transparency from Managed Care Organizations (MCOs) and PBMs in Rhode Island’s Medicaid program.
- Prohibit spread pricing: PBMs must not charge more to the plan than they reimburse the pharmacy for a drug; aim to curb practices that increase costs.

Section 3: Effective Date

  • The act takes effect upon passage.

Who and What Is Affected

  • Rhode Island residents enrolled in state health and human services programs, including Medicaid and CHIP.
  • The EOHH S (Secretary) and department directors of health and human services.
  • Managed Care Organizations (MCOs) operating under Rhode Island Medicaid.
  • Pharmacy Benefit Managers (PBMs) contracted to work with Medicaid and MCOs.
  • State agencies, local governments, and school departments funded under federal Titles XIX/XXI (Medicaid/CHIP) for reporting, budgeting, and program administration.
  • The Governor, the General Assembly (House and Senate Finance), and the Health Care Oversight/Caseload processes.

Procedural and Timeline Aspects

  • Introduction: February 26, 2026; referred to House Finance.
  • Hearing/consideration: Scheduled for May 5, 2026.
  • Advisory group report deadline: No later than October 31, 2025 (relates to the 2026 federal budget timeline) – noted in preparatory language; the actual act’s effective date is upon passage.
  • Reporting requirements: Biennial Medicaid reviews starting 2015 commitments; annual expenditure overview beginning in 2020 (due Sept 15 each year).

Practical Implications

  • Increased transparency and oversight of PBMs and MCOs in Medicaid, with a direct mechanism to curb spread pricing.
  • Expanded data collection and reporting to monitor costs, outcomes, and federal compliance.
  • Potential reforms to eligibility thresholds and benefit structures to address cost and access, subject to sliding scale design.
  • Centralized leadership and potential administrative reforms aimed at efficiency, coordination, and safeguarding access to services for Rhode Islanders.

Compiled from official sources — confirm details with the bill’s official record.

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