Governor Abbot of Texas Signs Legislation Unanimously Passed into Law Aimed at PBM Reform and Regulation – Huge Victory for Texas Pharmacies

As a follow-up to our May 18, 2021 article, the bipartisan piece of legislation that unanimously passed the Texas House and Senate aimed at regulating pharmacy benefit managers (PBMs) was signed into law by Governor Greg Abbott. This is a huge win for Texas Pharmacies.

This bipartisan piece of legislation contains several great components that Texas Pharmacies should plan to use to their advantage including:

(1) restrictions on retroactive claims reductions (including DIR fees);

(2) restrictions/limitations on contract provisions prohibiting pharmacies from mailing;              

(3) express prohibitions on retaliation by a PBM against pharmacies for invoking their legal rights against PBMs; and

(4) prohibitions on PBMs reimbursing affiliated pharmacies more than the amount reimbursed to nonaffiliated pharmacies for the same pharmacy services.

HB 1763 is an important law and reflects the growing concerns surrounding PBM conduct at the state level, but also an ever-increasing response to these concerns by state legislatures throughout the United States. Texas joins several other states that have recently enacted new legislation or laws aimed at reasonable regulation of PBMs and Texas Pharmacies must ensure they are taking all appropriate steps to utilize this legislation to their advantage. The new PBM Law is set to take effect September 1, 2021. Texas Pharmacies should use the time between now and September 1, 2021 to become familiar with the new Law so they can use it effectively beginning September 1, 2021.

How Frier Levitt Can Help

Frier Levitt represents numerous pharmacies across the United States in challenging PBM audits, network access, reimbursement practices and has extensive knowledge on all aspects of the pharmacy-PBM relationship. Contact us today to speak with an attorney about how your pharmacy can leverage the various laws and protections afforded to pharmacies, including Texas’ current PBM laws as well as the additional protections provided under SB 1763.