AN ACT to amend Tennessee Code Annotated, Title 53; Title 56; Title 63 and Title 71, relative to pharmacy benefits managers.
HB2333 creates a new Tennessee law regulating pharmacy benefits managers (PBMs) and their interactions with prescribers, pharmacists, and health plans. The bill declares that medical decision-making belongs to healthcare prescribers, and it limits PBMs from modifying, restricting, or denying medications ordered by a prescriber except through a formulary exception or prior authorization process. It also prohibits PBMs from imposing requirements that interfere with prescribing based on clinical judgment, from requiring additional approval for dispensing a valid prescription, and from using formularies, cost-sharing, or utilization management in ways that circumvent these protections.
The bill sets deadlines for PBM responses to prior authorization and formulary exception requests: 24 hours for urgent or exigent circumstances and 72 hours for non-urgent requests, with a failure to respond treated as approval. It also bars retaliatory actions against pharmacies or prescribers, such as network termination, reimbursement reductions, targeted audits, performance penalties, or claims-processing delays, when they exercise rights under the section. In addition, it authorizes the Department of Commerce and Insurance and the Department of Health to request contract, formulary, rebate, and fee information, and requires annual reporting by PBMs on prior authorization response times, approval/denial rates, exception requests, and rebate/fee categories.
The bill’s impact on state law is significant: it adds a new section to Tennessee’s insurance code, makes violations an unfair trade practice under the Tennessee Unfair Practices and Unfair Claims Settlement Act, authorizes civil penalties of up to $10,000 per violation, and allows harmed pharmacies or prescribers to seek injunctive relief and actual damages. It also amends existing law to clarify how the new PBM rules interact with ERISA plans, while expressly stating that the new section does not apply to ERISA-governed plans or their administrators. The bill further directs state agencies to promulgate rules and makes the act effective for most purposes on July 1, 2026.
Because no committee transcripts or votes were provided, the overall sentiment and any recorded opposition or support cannot be directly measured from the supplied history. Based on the bill text alone, the measure appears to reflect a policy preference for stronger oversight of PBMs, greater transparency, and more authority for prescribers and pharmacies. The main points of likely contention are the breadth of the restrictions on PBMs, the disclosure of contract and rebate information, the presumption of retaliatory action, and the extent to which the bill could affect plan design and utilization management practices, especially in relation to ERISA coverage.
HB2333 would add a new regulatory framework governing pharmacy benefits managers in Tennessee, creating enforceable limits on PBM conduct, disclosure obligations, reporting requirements, and penalties. It amends Title 56 to establish prescriber-protection rules, updates related provisions to coordinate with ERISA coverage, and adds a new unfair trade practice violation under Tennessee insurance law. The bill affects PBMs, health plans, pharmacies, healthcare prescribers, and state regulators, while expressly excluding ERISA-governed plans and their administrators from the new section.
No committee discussion or vote history was provided, so there is no recorded legislative sentiment to summarize from debate or roll calls. From the bill text, the measure is clearly framed as a consumer- and provider-protection bill aimed at limiting PBM influence over clinical decisions and increasing transparency. The overall tone of the legislation is assertive and regulatory, suggesting support from those concerned about PBM practices and likely resistance from PBMs and possibly health plan administrators.
The most likely points of contention are the bill’s restrictions on PBMs’ ability to manage formularies, prior authorization, and utilization controls, as well as its requirement to disclose contract terms, rebate arrangements, and fee structures. PBMs and health plans may object that the bill limits cost-management tools, imposes administrative burdens, and intrudes on plan design, while supporters would argue that it protects patient safety, prescriber autonomy, and transparency. The ERISA-related language is also potentially contentious because it attempts to define the bill’s reach relative to federally governed plans.