SB2008 Summary

• Requires insurance companies with drug formularies to immediately substitute brand name drugs with FDA-approved generic equivalents or move brand drugs to lower-cost formulary tiers for plans amended, delivered, issued, or renewed on or after January 1, 2022.

• Establishes comprehensive pharmacy benefit manager (PBM) regulations including requirements to update maximum allowable cost pricing every 7 calendar days, provide reasonable appeals processes for pharmacies to challenge pricing, and prohibit spread pricing practices.

• Mandates PBMs pay pharmacies professional dispensing fees at rates not less than state Medical Assistance Program rates and prohibits various restrictive practices including gag clauses, referrals to PBM-owned pharmacies, and certain fees on pharmacy providers.

• Sets strict standards for pharmacy audits conducted by PBMs including 30-day advance notice, limits on audit frequency and scope (100 prescriptions randomly selected per 12 months), prohibition on extrapolation for calculating penalties, and requirements for pharmacist consultation on clinical audits.

• Modifies Illinois Public Aid Code to require Medicaid managed care organizations to reimburse pharmacy providers' professional dispensing fees and acquisition costs at no less than fee-for-service rates, whether reimbursing directly or through PBMs.