State legislatures continue to focus on Rx 

The Share the Savings Act (effective on or about Aug. 1) requires fully insured plans and PBMs to apply all rebates to participant cost sharing at the point of sale (POS).

Two new laws apply to fully insured plans beginning in 2025. One law bans spread pricing (where a PBM charges more for a drug than its cost). A second law requires third-party assistance to apply to participant cost sharing, including deductibles, in many situations.

The Prescription Drug Reform Act bans spread pricing and requires 100% of rebates to pass through to plan sponsors. This law (applicable to self-funded plans) also regulates network adequacy and increases transparency. The PBM provisions will take effect in 2024.

Three laws scored from beyond the arc; another bill fouled out. First, a new law requires third-party Rx payment assistance to apply to an HMO’s or fully insured plan’s cost sharing, including deductibles, in certain situations. Second, a law prohibits a fully insured plan, as well as a self-funded professional employer organization (PEO) plan or multiple employer welfare arrangement (MEWA), from requiring physician-administered drugs be sourced from specific pharmacies (known as “white bagging”) where a participant has a chronic, complex, rare or life-threatening medical condition. The first two laws will take effect in 2024. Third, fully insured plans, as well as self-funded PEO plans and MEWAs, must provide Rx disclosures to participants and providers upon request, per a law effective in 2025. HB 2021 would have required PBMs of self-funded ERISA plans to comply with state law but failed to reach a floor vote after considerable opposition.

Starting in 2024, insulin copay caps will drop from $100 to $35 for fully insured plans under a new law, which also implements a $100 copay cap on covered insulin devices, both for a 30-day supply.

Two bills have passed one house, months before the September recess: SB 873, a 90% Rx rebate pass-through at POS to participants, and SB 90, a $35/30-day supply insulin copay cap.

Two bills await Governor J.B. Pritzker’s signature: the Access to Affordable Insulin Act, reducing the insulin/30-day supply cap from $100 to $35 (effective July 1, 2025), and a PBM prohibition on retaliation against pharmacies for certain information disclosures (effective July 1, 2023). Both bills apply to fully insured plans.

Two bills are worth watching. AB 1763/SB 788 would apply PBM rules to self-funded ERISA plans, effective the first day of the fourth month after enactment. AB 536 would require fully insured and self-funded plans to apply 100% of rebates at POS, effective the first day of the 18^th month after enactment.

A bill that passed the House in April would ban spread pricing, require a minimum dispensing fee payable to pharmacies and ban steerage to PBM-affiliated pharmacies, among other restrictions. PBM-managed self-funded plans would be in scope. This bill would apply to contracts issued, renewed or amended on or after Oct. 1, 2023.