The bill amends Chapter 176D of the General Laws to introduce new regulations governing pharmacy benefit managers (PBMs) and their reimbursement practices to pharmacies in the Commonwealth. A new section, 3C, is added, which defines key terms such as "maximum allowable cost list," "pharmacy acquisition cost," and "pharmacy benefits manager affiliate." The bill mandates that before a PBM can place a drug on its maximum allowable cost list, the drug must meet specific criteria, including being therapeutically and pharmaceutically equivalent and available for purchase from wholesalers in the Commonwealth. Additionally, the PBM is required to provide timely access to its maximum allowable cost list, update it promptly in response to cost changes, and establish a reasonable administrative appeal process for pharmacies to challenge reimbursements.

Furthermore, the bill stipulates that PBMs cannot reimburse pharmacies at a rate lower than what they pay their affiliates for the same services, ensuring fair compensation. Pharmacies are granted the right to refuse services if the reimbursement falls below their acquisition cost. The bill also applies to PBMs contracted with MassHealth or the group insurance commission and establishes that violations of these provisions will be considered deceptive and unfair trade practices under existing law. Overall, the legislation aims to enhance transparency and fairness in the reimbursement process for pharmacies.