HB345 Alabama 2020 Session

Summary

Primary Sponsor

Ron Johnson

Republican

Session

Regular Session 2020

Title

Pharmacy Benefits Managers, steering patients to affiliated pharmacies prohibited, mining patient data prohibited, requiring mail order pharmacies by health insurance plan prohibited, Act 2019-457, 2019 Reg. Sess., sections amended and renumbered; Secs. 27-45A-6 to 27-45A-10, inclusive, 27-45A-12 added; Secs. 27-45A-3, 27-45A-4, 27-45A-5 am'd.

Summary

HB345 would curb PBMs' influence by banning steering to affiliated pharmacies, restricting data sharing, ending mandatory mail-order requirements, and increasing rebate transparency with penalties for violations.

What This Bill Does

The bill would require PBMs to be licensed by the state insurance commissioner and adds restrictions on how they operate. It bans PBMs and health plans from steering patients to affiliated pharmacies or sharing patient data with affiliates for commercial purposes, and it stops plans from requiring exclusive use of mail-order distributors or affiliated pharmacies. It also requires PBMs to report to clients the total rebates received from drug manufacturers and those not passed through, and establishes civil penalties and enforcement mechanisms for violations. Additionally, it expands definitions and sets an effective date for these changes.

Who It Affects

• Pharmacy benefits managers and health benefit plans: must obtain licensure, must comply with new restrictions on steering, data sharing, mailing-order requirements, and rebate reporting, and face civil penalties for violations.
• Covered persons (enrollees/patients) and community retail pharmacies: cannot be forced to use mail-order or affiliated pharmacies, will have access to non-affiliated options within networks, and will receive information about cost shares and rebate transparency.

Key Provisions

• Prohibits PBMs and health benefit plans from steering patients to affiliated pharmacies and from sharing patient-identifiable data with affiliates for commercial purposes.
• Bars health benefit plans from requiring exclusive use of mail-order distributors or affiliated pharmacies for prescription drugs; requires parity in cost sharing and terms for non-mail-order providers if they contract with the plan.
• PBMs are restricted from limiting pharmacists' ability to provide pharmacist services and from steering patients to affiliated pharmacies; data exchange with affiliated pharmacies is limited to reimbursement, formulary, care, or utilization review.
• PBMs must report annually to clients the aggregate rebates received from manufacturers and the amount not passed through to the client.
• PBMs must be licensed by the commissioner; establishes licensure process, fees, and renewal; confidentiality rules for department records; penalties for violations.
• Violations may incur civil penalties up to $5,000 per act, with enforcement including injunctive relief and potential license suspension or revocation.
• Community retail pharmacies must be included in a PBM's network if they meet standard terms, and plans may not refuse to include them; the act applies to contracts issued after a specified date and sets transition rules for existing contracts.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Pharmacies and Pharmacists