This bill aims to enhance the transparency and accountability of pharmacy benefit managers (PBMs) in Rhode Island's Medicaid program, specifically by prohibiting the spread pricing payment model. It amends Section 42-7.2-5 of the General Laws, outlining the duties of the secretary of the executive office of health and human services (EOHHS). Key responsibilities include ensuring that managed care organizations (MCOs) and PBMs working for the Rhode Island Medicaid program are transparent, do not increase unnecessary costs for the Medicaid program and patients, and demonstrate improvement in patient health outcomes. The bill mandates that contracts with MCOs require PBMs to cease and prohibit activities that result in spread pricing, where PBMs charge a health plan more than they reimburse pharmacies for prescription drugs and retain the difference.

Additionally, the bill requires the secretary to monitor and mandate changes to the price-setting practices of PBMs. The act will take effect upon passage.

Statutes affected:
5498: 42-7.2-5