The proposed legislation, known as the "Pharmacy Services Administrative Organization Act," aims to regulate pharmacy services administrative organizations (PSAOs) in Arkansas. It introduces a new subchapter to the Arkansas Code, which includes definitions for key terms such as "administrative services," "pharmacy benefits manager," and "third-party payer." The act mandates that any entity wishing to operate as a PSAO must obtain a license from the Insurance Commissioner, who will establish the necessary application processes, fees, and compliance requirements. Additionally, the act outlines the responsibilities of PSAOs, including the requirement to provide pharmacies with contracts and disclosures regarding ownership and control.

Furthermore, the legislation stipulates that PSAOs must not compel pharmacies to purchase drugs exclusively from entities they are affiliated with, ensuring fair practices in the industry. It also includes provisions for timely communication and appeals processes between pharmacies and third-party payers, as well as enforcement measures by the Insurance Commissioner, who can impose penalties for violations. Overall, the act seeks to enhance transparency and accountability within the pharmacy services sector in Arkansas.