HB238 Summary

• Prohibits pharmacy benefits managers (PBMs) from reimbursing pharmacies less than actual acquisition cost plus a professional dispensing fee equal to Medicaid rates, and bans spread pricing where PBMs charge insurers different amounts than they pay pharmacies.

• Requires PBMs to pass 100 percent of rebates received from pharmaceutical manufacturers directly to health insurers unless the insurer directs otherwise, with annual reporting requirements to the insurance commissioner.

• Prohibits PBMs from initiating fraud, waste, or abuse investigations against pharmacies without reasonable suspicion and prior notification to the pharmacy and commissioner approval.

• Prevents PBMs from penalizing health insurers that switch to different PBMs, including by charging file access fees or withholding earned rebates during transitions.

• Makes PBM fraud, waste, or abuse investigations subject to the Pharmacy Audit Integrity Act and grants the Insurance Commissioner examination authority over PBMs similar to that held over insurers.

• Effective October 1, 2024.