On July 17, 2024, Pennsylvania Governor Josh Shapiro signed the Pharmacy Benefit Reform Act (House Bill 1993) into law, adding more tools for Pennsylvania to fight against abusive PBM practices. The Pharmacy Benefit Reform Act (“Act”) amends portions of Pennsylvania’s Pharmacy Audit Integrity and Transparency Act by including new provisions that will offer additional legal protections to independent pharmacies. Additionally, the Act helps to foster greater transparency and accountability for PBMs operating and doing business in Pennsylvania.
Among the provisions contained in the Act are provisions requiring greater network access, which will require PBMs operating in Pennsylvania to meet or exceed federal access standards. The Act also prohibits PBMs from steering patients to affiliated pharmacy operations, which has been a pronounced concern for independent pharmacies in Pennsylvania and throughout the country. Furthermore, the Act prohibits the practice of PBMs reimbursing affiliated pharmacy operations more than the PBM reimburses independent pharmacies. These types of provisions aim to further level the unequal playing field that PBMs have established over the past several years.
The Act also provides the Pennsylvania Insurance Department (“Department”) with additional oversight and enforcement authority as it relates to PBM conduct. This includes new requirements such as providing the Department with greater access to PBM records to ensure PBMs are operating in compliance with the Act. For non-compliance, the Department is empowered to impose penalties on PBMs which include ordering the PBM to reimburse a pharmacy for any loss suffered as a result of the PBM’s violation of the Act.
With the passage of the Act, Pennsylvania has taken an important step to ensure that independent pharmacies and providers operating in Pennsylvania have greater protections from some of the most pervasive PBM abuses. Independent pharmacies should familiarize themselves with the Act and consider hiring qualified legal counsel to ensure they are maximizing the protections and legal rights afforded to Pennsylvania pharmacies under Pennsylvania law, as well as other applicable laws including federal law and Medicare law.
Frier Levitt represents numerous pharmacies in Pennsylvania and across the United States in challenging unfair and aggressive PBM practices. Contact us to speak with an attorney about how your pharmacy can leverage the protections afforded by the Pharmacy Benefit Reform Act and other laws governing PBMs.
