This bill introduces comprehensive regulations for pharmacy benefits managers (PBMs) in Iowa, focusing on enhancing transparency and fairness in prescription drug pricing. It defines "pass-through pricing" and "spread pricing," and prohibits PBMs from discriminating against pharmacies or pharmacists based on their compliance with applicable laws. The legislation restricts PBMs from limiting a covered person's choice of pharmacy, imposing penalties for selecting a pharmacy, or mandating the exclusive use of mail-order pharmacies. Additionally, it requires that cost-sharing for prescriptions be calculated at the point of sale, taking into account any rebates received by the health carrier or PBM.

Moreover, the bill mandates that PBMs reimburse pharmacies at rates that meet or exceed 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 to dispense prescriptions if the reimbursement is below their acquisition cost. All contracts related to prescription drug benefits executed or renewed after July 1, 2025, must adopt a pass-through pricing model and eliminate terms allowing spread pricing unless the PBM passes through the entire difference. The bill also includes an appeals process for pharmacies contesting reimbursement rates and 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