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HB 1354

Veterinary medicine.

2025 Regular Session Introduced by Mike Aylesworth and 2 co-sponsors

House Bill 1354 regulates pharmacy benefits managers in Arkansas, ensuring fairer drug pricing and higher reimbursements for retail pharmacies, impacting state employees' health plans.

Public Law 62
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Bill Summary · HB 1354

Summary of House Bill 1354

Bill Number: HB 1354
Title: To Regulate Pharmacy Benefits Managers; To Amend the Law Concerning the State and Public School Life and Health Insurance Program; and To Amend the Law Concerning Certain Health Benefit Plans.
Status: Recommended for study in the Interim by the Committee on Insurance & Commerce - House
Introduced: January 31, 2025

Purpose of the Bill

House Bill 1354 aims to regulate pharmacy benefits managers (PBMs) in Arkansas, amend existing laws related to the State and Public School Life and Health Insurance Program, and modify regulations concerning certain health benefit plans offered by governmental entities. The bill seeks to enhance transparency and fairness in the management of pharmacy benefits, particularly in relation to reimbursement practices and the negotiation of drug prices.

Key Provisions

  1. Regulation of Pharmacy Benefits Managers:

    • Prohibits PBMs from reimbursing their own pharmacies at rates higher than those for independent pharmacies.
    • Bans PBMs from using variable copay or manufacturer coupon maximizer programs that do not allow for savings to be passed on to consumers.

  2. Reimbursement Standards:

    • Establishes minimum reimbursement rates for retail pharmacies, ensuring they receive at least the National Average Drug Acquisition Cost (NADAC) plus the Arkansas Medicaid dispensing fee.
    • Prohibits PBMs from charging fees related to managing prescription drug manufacturer coupons that exceed those of the Evidence-Based Prescription Drug Program of the University of Arkansas for Medical Sciences.

  3. Contractual Restrictions:

    • Starting January 1, 2026, state government and public plan sponsors cannot contract with PBMs that utilize national contracts that do not comply with Arkansas law.
    • PBMs are restricted from negotiating manufacturer rebates through group purchasing organizations, potentially impacting the overall cost of pharmacy plans.

  4. Impact on Costs:

    • The bill is projected to incur approximately $30 million in potential costs due to increased retail pharmacy reimbursement rates and the prohibition of certain PBM practices.
    • The Employee Benefits Division (EBD) would absorb these costs, as the bill prevents passing them onto enrollees.

Affected Parties

  • Pharmacy Benefits Managers: Will face stricter regulations and potential financial impacts due to the new reimbursement and contractual requirements.
  • Retail Pharmacies: Expected to benefit from higher reimbursement rates and fairer competition against PBM-owned pharmacies.
  • State and Public School Employees: May experience changes in their health benefit plans, particularly regarding prescription drug costs and access.

Procedural Timeline

  • January 31, 2025: Bill filed.
  • February 3, 2025: First reading and referral to the Committee on House Journal; Engrossed and Enrolled Bills.
  • February 27, 2025: Bill read a second time, amended, and reported correctly engrossed.
  • April 16, 2025: Bill withdrawn by the author and recommended for study in the Interim.

Conclusion

House Bill 1354 represents a significant shift in the regulation of pharmacy benefits managers in Arkansas, aiming to enhance fairness in drug pricing and reimbursement practices. The bill's potential financial implications and its impact on various stakeholders highlight the importance of careful consideration and study as it moves forward in the legislative process.

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

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