SB73 Alabama 2019 Session

Summary

Primary Sponsor

Arthur OrrSenator

Republican

Session

Regular Session 2019

Title

Pharmacy benefit managers, prohibited from restricting pharmacies and pharmacists from disclosing costs information to patients on alternative drugs or other services and costs, enforcement by Insurance Commissioner, audits further regulated including penalties and assessments against pharmacist, Sec. 34-23-184 am'd.

Summary

SB 73 creates a licensure and regulatory framework for pharmacy benefit managers in Alabama and requires cost-sharing transparency for patients.

What This Bill Does

The bill creates an Alabama Pharmacy Benefits Manager Licensure and Regulation Act that requires PBMs to be licensed by the Insurance Commissioner and to register to operate in the state. It sets license rules, including up to $500 fees, public record status, and biennial renewals, with penalties for noncompliance. It also protects patients by allowing pharmacies and pharmacists to disclose cost information and cheaper alternatives to patients, and it requires health plans not to require at-point-of-sale payments higher than the lesser of the contract co-pay or the cash price. The act gives the Insurance Commissioner authority to adopt rules and enforce violations.

Who It Affects

• Pharmacy benefit managers (PBMs) – must obtain a state license, register to operate, and comply with regulatory requirements; penalties can be imposed for violations.
• Pharmacies, pharmacists, health benefit plans, and enrollees/covered persons – gain the right to receive and share cost information, discuss cheaper drug alternatives, and are protected by cost-sharing rules that limit cash payments at the point of sale.

Key Provisions

• Establishes PBM licensure and registration requirements, effective January 1, 2020, with license fees up to $500 and biennial renewals; licenses are public records.
• Prohibits PBMs from restricting pharmacies and pharmacists from disclosing a patient’s out-of-pocket costs and from steering patients to more expensive options when cheaper alternatives are available.
• Requires health benefit plans to limit point-of-sale payments to the lesser of the contract co-pay or the cash price for a prescription.
• Defines PBM-related terms (claims processing services, other prescription drug or device services, etc.) and clarifies the scope of regulated activities.
• Authorizes the Insurance Commissioner to adopt rules, impose penalties and fines, and regulate licensure and compliance.
• Applies to contracts issued or renewed on or after January 1, 2020; existing contracts must comply as a condition of licensure.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Pharmacies and Pharmacists