Another state has inked a law that takes aim at how pharmacy benefit managers do business.
Last week, Iowa Gov. Kim Reynolds signed into law a piece of legislation that would bar PBMs from steering patients to specific pharmacies or choosing to exclude certain pharmacies from their networks in an unfair way. The bill mirrors similar legislation passed in Texas, Georgia, Indiana and Montana, Reynolds said in a statement.
The law would require PBMs to reimburse independent or unaffiliated pharmacies at the same rate they pay affiliated facilities, and also pay dispensing fees for prescriptions.
Reynolds said in her statement that she chose to sign the bill into law after holding a series of conversations with employers in the state, and added that there will be significant oversight in implementation to ensure the costs do not blow back on employers.
She added that the legislation is just a piece of the state's broader efforts to address rural healthcare, as 34 rural pharmacies have closed in Iowa over the past year.
"The new bill takes steps toward addressing these challenges by targeting PBM practices that harm both patients and independent pharmacies," Reynolds said. "Local pharmacies, especially in rural areas, are vital to community health and local hospitals but are being driven out by opaque, one-sided contracts."
"Additionally, this legislation amplifies the rural healthcare bill we passed this session and is a meaningful step toward a fairer, more transparent, and accessible healthcare system for all," she said.
PBMs have been under fire as policymakers and other stakeholders seek solutions to the rising cost of prescription drugs. While efforts at the federal level to regulate the industry haven't borne fruit, multiple states have instituted bills that target PBMs.
Arkansas' approach has drawn the most ire from the industry. Earlier this year, the state codified a law that bars PBMs from owning or being affiliated with pharmacies operating in the state, a significant blow to one of the industry's "Big Three," CVS Health.
CVS, along with its rival Express Scripts and the Pharmaceutical Care Management Association, are all suing the state over the law.