WeVote
Log In

Bill

Bill

A 5012

Requires certain standards be established for contracts between pharmacy benefits managers and health benefits plans.

2026-2027 Regular Session

Health plans and PBMs must allow any pharmacy meeting standard contract terms to participate in the network, promoting open participation and fair access.

Introduced, Referred to Assembly Financial Institutions and Insurance Committee
0
WeVote Research Nonpartisan
Bill Summary · A 5012

Summary of Bill A 5012 (Session 222) – New Jersey

Purpose and Intent

  • Establishes standards for contracts between health benefits plans that cover prescription drugs or pharmacy services and pharmacy benefits managers (PBMs).
  • Aims to ensure network participation by any pharmacy meeting the plan’s standard contract terms, promoting broader access to network pharmacies.

Key Provisions

1) Network participation requirement
- A health benefits plan that covers prescription drugs or pharmacy services and is administered or managed by a PBM must allow any pharmacy that meets the plan’s standard contract terms and conditions to participate as a network pharmacy.
- This effectively prevents arbitrary exclusions by PBMs and requires open participation for qualifying pharmacies.

2) Standards for contract terms
- The terms and conditions of the PBM–plan contract must be reasonable and relevant.
- Reasonableness and relevance are determined by the Commissioner of Banking and Insurance (CBI).
- The CBI must consider, at minimum:
- Current terms and conditions in existing network pharmacy contracts.
- Reimbursement and dispensing fees paid by the health benefits plans, and whether these payments are sufficient to cover both ingredient costs and operational costs for pharmacies.

3) Regulatory authority and rulemaking
- The Commissioner of Banking and Insurance may adopt rules and regulations under the state Administrative Procedure Act to implement the act’s provisions.

4) Effective date and applicability
- The act takes effect on the first day of the thirteenth month after enactment.
- It applies to contracts between a health benefits plan and a PBM that are initiated or renewed on or after the effective date.

Who/What Is Affected

  • Parties affected:
    • Health benefits plans that provide prescription drug or pharmacy services and are administered or managed by PBMs.
    • Pharmacies that meet the plan’s standard contract terms and conditions.
    • The Commissioner of Banking and Insurance, as the authority to define “reasonable and relevant” terms and to adopt implementing regulations.
  • Practical impact:
    • Potential expansion of pharmacy network participation for plans and PBMs.
    • Increased scrutiny of contract terms and reimbursement/dispensing fees to ensure they cover costs and are fair.
    • Possible standardization or alignment of contract terms with broader industry practices as determined by state regulatory guidance.

Procedural and Timeline Aspects

  • Introduction: May 7, 2026; referred to Assembly Financial Institutions and Insurance Committee.
  • Regulatory path: Allows the CBI to promulgate rules to effectuate the act.
  • Effective date: January 11, 2027 (the first day of the 13th month after enactment).
  • Applicability: Only contracts initiated or renewed on or after the effective date are subject to the act.

Practical Implications and Considerations

  • For pharmacies: Potential greater access to networks if they meet standard terms and the plan’s criteria, but actual impact depends on how “standard terms” are defined and enforced.
  • For health plans/PBMs: May require adjustments to contract terms and reimbursement structures to satisfy the “reasonable and relevant” standard, which could influence pricing and formulary operations.
  • For consumers: Possible broader access to network pharmacies and more consistent reimbursement practices, potentially affecting out-of-pocket costs and drug access.

If you’d like, I can compare this bill to existing NJ PBM contract standards or provide a brief overview of related regulatory frameworks in other states for context.

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

Sign in to ask a question.