Fiscal Note
Fiscal Services Division
HF 2384 – Pharmacy Benefits Managers (LSB5519HV.3)
Staff Contact: Xavier Leonard (515.725.0509) xavier.leonard@legis.iowa.gov
Fiscal Note Version – Final Action
Description
House File 2384 relates to pharmacy benefits managers (PBMs), pharmacies, and prescription
drug benefits. The Bill makes the following changes:
• Division I defines terms, requires rulemaking, clarifies language, adds additional duties to
PBMs and the Iowa Insurance Division (IID) in the Department of Commerce, and makes
changes to PBM reimbursements.
• Prohibits a covered person from making a cost-sharing payment at the point of sale for a
prescription drug that exceeds the total amount that the pharmacy, at which the covered
person’s prescription drug order is reimbursed, paid.
• Prevents PBMs from prohibiting pharmacies from disclosing or selling lower-cost drug
options to covered persons.
• Requires a PBM to reimburse all in-state pharmacies at the rate the PBM reimburses its
affiliates for dispersing the same prescription drug.
• Division II defines terms and changes references to “health carrier” in Iowa Code section
510C.2 to “third-party payor.”
• Division III permits the IID to adopt emergency rules to implement the provisions of the Bill.
The rules shall be immediately effective unless otherwise specified.
Background
Cost-sharing payments are out-of-pocket cost obligations imposed by a health benefit plan on a
covered person. These include but are not limited to coverage limits, copayments, coinsurance,
and deductibles.
The Commissioner of Insurance is responsible for ensuring parties subject to laws related to
cost-sharing payments law are in compliance.
House File 2384 is estimated to impact approximately 25.8% of the population (822,000). This
includes individual coverage, fully insured small and large employer groups, self-insured public
employees, and the State of Iowa Plan.
Of the population covered by insurance plans not regulated by Iowa law, approximately 45.2%
are covered by government-sponsored health insurance, 23.0% are covered by employer
coverage that is governed by the federal Employee Retirement Income Security Act of 1974
(ERISA), and the remaining 6.0% are uninsured. Table 1 below details the population covered
by insurance plans regulated by Iowa law.
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Table 1 — Population Covered by Insurance Plans Regulated by Iowa Law
Source: Iowa Insurance Division, Department of Commerce
Assumption
Additional examination and enforcement actions carried out by the Iowa Insurance Division will
require the Division to add 2.0 full-time equivalent (FTE) positions for an Insurance Market
Complaint Analyst and an Insurance Compliance Analyst.
Fiscal Impact
Expenditures from the Commerce Revolving Fund are estimated to increase by $200,000
annually for 2.0 FTE positions. This cost is for an Insurance Market Complaint Analyst FTE
position to process complaints as received, with a total cost of approximately $110,000, and an
Insurance Compliance Analyst FTE position, with a total cost of approximately $90,000, for the
purposes of examining and enforcing compliance with the provisions of the Bill.
Sources
Board of Regents
Iowa Insurance Division, Department of Commerce
Wellmark
/s/ Holly M. Lyons
June 27, 2022
Doc ID 1291719
The fiscal note for this Bill was prepared pursuant to Joint Rule 17 and the Iowa Code. Data used in
developing this fiscal note is available from the Fiscal Services Division of the Legislative Services
Agency upon request.
www.legis.iowa.gov
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Statutes affected:
Introduced: 505.26, 510B.1, 510B.4, 510B.5, 510B.6, 510B.7, 510B.8, 155A.17, 507B.7
Reprinted: 505.26, 510B.1, 510B.4, 510B.5, 510B.6, 510B.7, 510B.8, 155A.17, 507B.7
Enrolled: 507B.4, 510B.1, 510B.4, 510B.5, 510B.6, 510B.7, 510B.8, 510B.9, 505.26, 507B.7, 510C.1, 514J.102, 510C.2