This bill introduces comprehensive regulations for pharmacy benefit managers (PBMs) in Iowa, aimed at promoting transparency and fairness in the management of pharmacy benefits. It defines key terms such as "pass-through pricing" and "spread pricing," and prohibits PBMs from discriminating against pharmacies or pharmacists based on their compliance with applicable laws. The legislation ensures that PBMs cannot restrict a covered person's choice of pharmacy or impose penalties for their selection, while also mandating equal reimbursement terms for all pharmacies within a geographical area.

Additionally, the bill sets forth specific reimbursement requirements for PBMs, ensuring that they do not pay pharmacies less than the national average drug acquisition cost, the Iowa average acquisition cost, or the wholesale acquisition cost, depending on availability. It establishes a professional dispensing fee aligned with the Iowa Medicaid enterprise provider fee schedule and grants pharmacies the right to refuse prescriptions if reimbursement falls below their acquisition cost. Contracts related to prescription drug benefits executed or renewed after July 1, 2025, must adopt a pass-through pricing model and prohibit spread pricing unless the full difference is passed through to the pharmacy. The bill will take effect for PBMs managing prescription drug benefits in Iowa starting January 1, 2026.

Statutes affected:
Introduced: 510B.1, 510B.4, 510B.8, 510B.8B