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HB 2440

INS CD-PRESCRIPTION DRUG PRICE

104th Regular Session Introduced by Mary Beth Canty

Requires advance 90-day written notice and a Department-approved appeals/exception process for PBMs and insurers when drug coverage or pricing changes, including medical-necessity

Rule 19(a) / Re-referred to Rules Committee
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Bill Summary · HB 2440

HB 2440 — Prescription Drug Pricing Transparency & Appeals (Illinois)

Status and sponsor
- Introduced: 2/4/2025
- Sponsor: Rep. Mary Beth Canty
- Key change: Adds Sections 513b8 and 513b9 to the Illinois Insurance Code
- Bill type: regulation of pharmacy benefit managers (PBMs) and health insurers

Purpose
- Increase transparency and patient protections when PBMs or health insurers change prescription drug coverage or pricing.
- Require advance notice to affected beneficiaries and establish an appeals/exception process that lets patients present evidence of medical necessity.

Key provisions
- Notice requirement (Section 513b8)
- PBMs and health insurers must notify beneficiaries who would be affected before making changes in prescription drug coverage or pricing that impact a health plan in the State.
- Notice must be written and provided at least 90 days before the decision is finalized, sent by first-class mail or email.
- Notices must include relevant details about the coverage or price change, cost-sharing information, and instructions on how to appeal or request an exception (as defined in Sec. 513b9).

  • Appeals and exceptions process (Section 513b9)

    • PBMs and insurers must submit, on or before July 30, 2026, a plan to the Department of Insurance (the Department) for approval describing how beneficiaries can appeal or seek exceptions to contemplated changes.
    • Appeals must allow beneficiaries to present evidence that the new coverage would be less effective and that medical necessity supports retention of prior coverage.
    • Exception requests must allow beneficiaries to present evidence that their specific medical needs justify an exception.

  • Department review and timelines

    • If the Department determines the submitted appeals/exception plan is inadequate or fails to appropriately rely on medical necessity, it will specify required changes (within 90 days of receiving the plan).
    • If a PBM or insurer disputes required changes, it may request a Department hearing within 10 calendar days of receiving the Department’s changes.
    • The Department is required to issue a final written decision within 5 days after the hearing.

Who is affected
- Directly: pharmacy benefit managers and health insurers operating in Illinois; beneficiaries (insured individuals) whose drug coverage or pricing would change.
- Indirectly: providers and pharmacies who may need to support appeals/exception documentation.

Potential impacts and considerations
- Benefits: greater advance notice for patients, formalized ability to challenge coverage changes on medical necessity grounds, and regulatory oversight to ensure appeals are meaningful.
- Operational effects: PBMs and insurers will need to implement or revise notice systems and appeals/exception processes and prepare plans for Department approval by July 30, 2026.
- Administrative and timing pressures: the statutory timelines for Department review (90 days), hearing requests (10 days), and Department final decisions (5 days) are relatively short and may compress review/implementation schedules.
- Enforcement: Department of Insurance oversight with authority to require changes and adjudicate disputes.

Note: This summary is based on the bill text adding Sections 513b8 and 513b9 to the Illinois Insurance Code (prescription drug pricing transparency and appeals).

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

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