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Insurance department says it will publish penalty structure after PBM enforcement raised questions
Summary
State insurance staff told the Joint Budget Committee they are writing a bulletin to clarify penalties under emergency Rule 128 for pharmacy benefit manager (PBM) violations after initial July enforcements drew criticism for large flat fines applied to very small pricing deviations.
The Arkansas Insurance Department told the Joint Budget Committee during its meeting that it will publish a penalty structure to govern enforcement under emergency Rule 128 for pharmacy benefit manager behavior after the department’s first set of July enforcements prompted questions about large fines for small pricing deviations.
The clarification follows committee questioning about fines that began at the statutory maximum. Daniel Hall, general counsel for the PBM Division at the Arkansas Insurance Department, told the committee, "We have the authority to assess a penalty up to $5,000." Hall and other department staff said the department will issue a bulletin establishing a graduated penalty schedule so penalties start lower for initial violations and increase for repeat infractions.
The issue arose after pharmacy owners and several legislators raised examples in which reimbursements were measured as fractions of a cent or a few dimes…
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