This bill introduces comprehensive regulations for pharmacy benefit 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 ensures that PBMs cannot restrict a covered person's choice of pharmacy or impose penalties for selecting a pharmacy, while also mandating equal reimbursement terms for all pharmacies within a geographical area. Additionally, PBMs are required to reimburse pharmacies at rates that meet or exceed the national average drug acquisition cost, the Iowa average acquisition cost, or the wholesale acquisition cost, along with a professional dispensing fee aligned with the Iowa Medicaid enterprise provider fee schedule.

Moreover, the bill establishes an appeals process for pharmacies to contest reimbursement rates that fall below acquisition costs and mandates that all contracts related to prescription drug benefits executed or renewed after July 1, 2025, must adopt a pass-through pricing model, eliminating spread pricing unless the full difference is passed through to the pharmacy. The provisions of this bill will take effect for PBMs managing prescription drug benefits in Iowa starting July 1, 2025, with additional requirements applying from January 1, 2026.

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