An Act Establishing A Duty Of Good Faith And Fair Dealing Owed By Pharmacy Benefits Managers.
Summary
SB 820 would amend Title 38a of the Connecticut General Statutes to create an explicit duty of good faith and fair dealing for pharmacy benefits managers (PBMs). The duty would apply to PBMs in connection with the management services they provide and would extend to all parties they interact with in that role, including health carriers, health benefit plan sponsors, pharmacies, and covered persons.
In practical terms, the bill is aimed at regulating PBM conduct by requiring fair dealing across the PBM’s relationships in the prescription drug supply and benefits administration chain. The proposal does not specify detailed enforcement mechanisms in the bill text provided, but it would add a new legal standard that could be used to evaluate PBM actions and potentially support disputes or regulatory oversight involving PBMs and their business practices.
Impact
The bill would change state insurance law by adding a statutory good-faith-and-fair-dealing obligation for pharmacy benefits managers under Title 38a. This would affect PBMs operating in Connecticut, as well as health carriers, plan sponsors, pharmacies, and insured or covered individuals who interact with PBMs. By creating an express duty, the bill could influence contract interpretation, regulatory enforcement, and litigation involving PBM practices, even though the text provided does not detail penalties or specific remedies.
Sentiment
No committee transcripts or recorded votes were provided, so there is no direct evidence of debate, support, or opposition in the materials supplied. Based on the bill’s subject matter, the proposal appears consumer- and provider-protective in nature, targeting PBM conduct and seeking to impose a fairness standard on an industry often scrutinized for pricing and reimbursement practices.
Contention
The bill text itself does not identify any specific points of contention, and no hearing transcript or vote history is available to show where disagreement might lie. If opposition emerges, it would likely center on the breadth of the proposed duty, possible effects on PBM contracting flexibility, administrative burden, and whether existing insurance and contract law already addresses the conduct the bill seeks to regulate. Support would likely come from pharmacies, patient advocates, and potentially plan sponsors or carriers seeking greater transparency and accountability from PBMs.