A bill for an act relating to pharmacy benefits managers, pharmacies, and prescription drugs and including applicability provisions.(See HF 852.)
HSB99 makes broad changes to Iowa’s pharmacy benefit manager (PBM) laws and the way prescription drug benefits are administered. The bill defines and regulates “pass-through pricing” and “spread pricing,” and generally requires PBMs to pass through to pharmacies and health plans the amounts they receive for prescription drugs rather than keeping a spread between what the plan pays and what the pharmacy is reimbursed. It also prohibits PBMs and related entities from discriminating against pharmacies or pharmacists, from steering patients toward preferred pharmacies through monetary penalties or advantages, and from imposing extra credentialing or participation requirements beyond state licensure standards.
The bill also limits mail-order and specialty-drug practices. It bars PBMs from requiring exclusive use of mail-order pharmacies, restricts higher cost-sharing or more burdensome terms for prescriptions filled at retail pharmacies, and prevents unreasonable designation of drugs as specialty drugs to restrict access. In addition, it requires plans to notify pharmacies when network participation is restricted, to offer participation on identical reimbursement terms within the geographic area, and to inform covered persons of participating pharmacies. The bill further directs that patient cost-sharing be calculated at the point of sale using rebate-adjusted pricing, and that amounts paid by patients count toward cost-sharing and deductibles.
HSB99 would also set minimum reimbursement standards for pharmacies. PBMs could not reimburse Iowa pharmacies below the most recently published national average drug acquisition cost, Iowa average acquisition cost, or, if unavailable, wholesale acquisition cost, and must also pay a professional dispensing fee at least equal to the Iowa Medicaid enterprise fee schedule. Pharmacies would be allowed to decline to dispense prescriptions if those reimbursement requirements are not met. The bill creates an appeals process for pharmacies to challenge reimbursement rates, with deadlines and required PBM responses, and it applies these rules to PBM-managed prescription drug benefits in Iowa on or after July 1, 2025, with certain contract provisions taking effect for contracts renewed or amended on or after July 1, 2025 and applicable on or after January 1, 2026.
The overall sentiment reflected in the available history is strongly favorable in committee, with the House Commerce Committee reporting the bill 23-0. No committee transcript is available, but the unanimous vote suggests broad support for tighter PBM regulation and pharmacy protections. At the same time, the bill’s structure indicates it is aimed at shifting leverage away from PBMs and toward pharmacies and consumers, which is the likely source of policy debate even though no recorded opposition appears in the provided materials.
The bill would substantially amend Iowa Code chapter 510B governing pharmacy benefits managers by adding new definitions, prohibitions, reimbursement floors, appeals rights, and contract requirements. It would affect PBMs, health carriers, third-party payors, insurance producers, pharmacies, pharmacists, and covered persons by regulating network participation, reimbursement methodology, cost-sharing calculations, rebate treatment, and specialty-drug and mail-order practices. It also gives the insurance commissioner enforcement leverage by tying PBM certification and producer licensing to compliance, and it creates a private right to seek injunctive relief for injured pharmacies or covered persons.
The available voting record shows unanimous committee approval, indicating a generally positive or at least noncontroversial reception in the House Commerce Committee. The bill appears to align with concerns about PBM pricing practices and pharmacy access, and the absence of recorded dissent in the provided materials suggests support for stronger oversight of PBMs and more favorable treatment for independent pharmacies and consumers.
The main policy tensions are between PBMs/health plans and pharmacies/consumers over pricing power, network design, and reimbursement levels. Likely points of contention include the requirement to use pass-through pricing, the prohibition on spread pricing unless fully passed through, the mandate to reimburse at acquisition-cost benchmarks plus dispensing fees, and the restriction on specialty-drug designations and mail-order steering. Another possible area of dispute is the bill’s limits on plan design and contracting flexibility, including identical reimbursement terms for pharmacies in a geographic area and the ability of pharmacies to decline dispensing if reimbursement is too low.