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A 4657

Requires pharmacy benefits managers to make certain disclosures to health benefits plan sponsors.

2026-2027 Regular Session Introduced by Shama Haider and 1 co-sponsor

NJ 4657 requires PBMs to disclose detailed pricing, rebates, and compensation to plan sponsors and the state, with audits and semiannual, plain-language reports.

Reported and Referred to Assembly State and Local Government Committee
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Bill Summary · A 4657

Overview

A 4657 is a New Jersey bill (Session 222) that would require pharmacy benefits managers (PBMs) to disclose detailed information to health benefits plan sponsors and the state Department of Banking and Insurance. The core aim is to increase transparency around drug pricing, rebates, and the financial flows associated with PBM activities, and to give plan sponsors enhanced rights to audit PBMs.

Main purpose and intent

  • To ensure plan sponsors have comprehensive, itemized visibility into drug pricing, rebates, and related remuneration.
  • To provide the department with standardized reporting requirements to monitor PBM practices.
  • To empower plan sponsors with information useful for selecting PBM services and to educate beneficiaries through summarized plan information.

Key provisions and changes

  • Definitions (Section 1):
    • Establishes key terms such as “applicable entity,” “contracted compensation,” “dispensing channel,” and “plan sponsor.”
  • Mandatory reporting (Section 3):
    • PBMs must submit reports to plan sponsors and the department at least every six months.
    • Reports must be in plain language and machine-readable formats (with department-approved formats).
    • Required data for each drug on file includes:
    • Contracted compensation paid by the plan sponsor and paid to the pharmacy/PBM (by National Drug Code, NDC).
    • The difference between amounts paid to the PBM and the pharmacy.
    • Drug identifiers, dispensing channel types, brand/generic status, and associated price data (WAC or AWP as applicable).
    • Net price per course, out-of-pocket spending, total net spending, rebates/fees/remuneration received by the plan and by the PBM, and, if feasible, manufacturer copay assistance details.
    • Therapeutic-class reporting (Section 3b) includes gross and net spending by class, average net spending per 30- and 90-day supplies, beneficiary counts, formulary/tier details, and out-of-pocket costs.
    • High-spend drugs (Section 3c): for drugs with gross plan spending over $10,000 (or over $10,000 for the top 50 drugs), require disclosure of alternative drugs in the same class, formulary rationale, and any changes in formulary placement.
    • Affiliated/owned pharmacies (Section 3d): requires explanations of benefit designs favoring affiliated pharmacies, share of prescriptions, and drug-level cost data for affiliated vs. non-affiliated dispenses.
  • Plan sponsor-facing summaries (Section 4):
    • At report delivery, PBMs must provide:
    • A plan-wide summary with guidance-compatible data useful for PBM selection (estimated net price, cost per claim, fee structure, estimated cost per participant).
    • A beneficiary-facing summary (aggregate data, with an option for beneficiaries to request individual claim details).
    • Drug-specific data: net plan spending, remuneration from applicable entities, and, where feasible, manufacturer copayment assistance details.
    • Aggregate information on rebates/fees paid to brokers/advisors and the criteria for PBM selection or retention.
    • An explanation of any benefit design parameters favoring affiliated networks.
    • Total gross plan spending.
  • Audit provisions (Section 5):
    • Plan sponsors may request annual audits of PBMs to verify contract compliance and data accuracy.
    • Plan sponsors can select the auditor; PBMs must provide records, data, and contract information to the auditor and respond to information requests within stated timelines.
  • Effective date (Section 6):
    • The act would take effect on the first day of the 12th month after enactment and apply to contracts entered into on or after that date.

Who is affected

  • Pharmacy benefits managers (PBMs) operating in New Jersey.
  • Health benefits plan sponsors (carriers or purchasers of health plans) that contract with PBMs.
  • Applicable entities (broader network including manufacturers, distributors, rebate aggregators, and related third parties) due to data sharing requirements.
  • Department of Banking and Insurance, which would oversee reporting formats and guidance.

Procedural and timeline aspects

  • Reports required at least semiannually (every six months).
  • Reports must be delivered in multiple formats (plain language, machine-readable, and department-determined formats).
  • Annual audits upon request of plan sponsor.
  • Effective date: law would apply to contracts entered into on or after the date that falls 12 months post-enactment.

This bill emphasizes transparency in PBM pricing, rebates, and network design, while granting plan sponsors and beneficiaries clearer information and audit mechanisms.

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

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