Senate Bill 345 Alabama 2026 Session

Summary

Primary Sponsor

Larry StuttsSenator

Republican

Session

2026 Regular Session

Title

Pharmacy Benefits Manager regulation; to substitute "unaffiliated" pharmacy for "independent" pharmacy

Summary

SB345 updates Alabama's Pharmacy Benefits Manager rules by replacing 'independent' with 'unaffiliated' pharmacy terminology and extending protections to unaffiliated pharmacies.

What This Bill Does

It deletes the old definition of 'independent pharmacy' and creates a new definition for 'unaffiliated pharmacy' as a pharmacy not affiliated with a PBM. It makes conforming changes across the PBM law to treat unaffiliated pharmacies the same as in-network pharmacies in pricing and reimbursement rules. It imposes new prohibitions and constraints on PBMs when dealing with unaffiliated pharmacies, including limits on reimbursements, spread pricing, credentialing, network participation, and patient cost-sharing. It takes effect June 1, 2026, and includes required reporting where spread pricing is used.

Who It Affects

• Unaffiliated pharmacies (pharmacies not affiliated with a PBM affiliate) would receive protections against lower reimbursements and certain fees, and could be reimbursed under terms similar to Medicaid rates when applicable.
• Pharmacy Benefits Managers (PBMs) would face new restrictions on reimbursements to unaffiliated pharmacies, pricing practices (including spread pricing), credentialing, and participation rules.
• Health benefit plans and health insurers (including Medicaid-related pricing) would be subject to the new pricing and reporting requirements affecting how drugs are reimbursed to unaffiliated pharmacies.
• Patients/covered individuals would benefit from more transparent pricing and protections against cost-shifting when using unaffiliated pharmacies.

Key Provisions

• Replaces the term 'independent pharmacy' with 'unaffiliated pharmacy' and defines unaffiliated pharmacy as a pharmacy not affiliated with a PBM affiliate.
• Adds definitions in thePBM law to support unaffiliated pharmacies (affiliate, claims processing services, covered individual, health benefit plan, health insurer, unaffiliated pharmacy) and makes conforming changes across Sections 27-45A-3, -10 and -13.
• PBMs may not reimburse unaffiliated pharmacies at less than Medicaid reimbursement rate, may not make post-adjudication reductions, and may not raise patient cost-sharing to recoup dispensing costs.
• If an unaffiliated pharmacy is bypassed in favor of another in-network pharmacy, the PBM must pay the unaffiliated pharmacy a surcharge equal to the reimbursement that would have been paid had the unaffiliated pharmacy dispensed the drug.
• Prohibits denial of payment to an unaffiliated pharmacy when the drug is available from another in-network pharmacy, and restricts unreasonable credentialing or enrollment hurdles beyond Alabama Board of Pharmacy standards.
• Requires an annual report by PBMs on spread pricing differences if used, disclosing the difference between plan charges and network reimbursements.
• Effective date is June 1, 2026.

AI-generated summary using openai/gpt-5-nano-2025-08-07 on Mar 5, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Insurance