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Lawmakers hear debate on LB109 to limit PBM steering, restrict white‑bagging and protect local pharmacies
Summary
LB109 would ban certain PBM practices including compulsory white‑bagging, prevent PBMs from restricting how retail pharmacies deliver medications, and require accredited Nebraska pharmacies be eligible for specialty networks.
LB109, introduced by Senator Elliot Bostar, would prohibit pharmacy benefit managers (PBMs) from requiring "white bagging" (a practice in which a PBM’s specialty pharmacy ships a medication directly to a hospital or clinic for clinician administration) and would stop PBMs from restricting retail pharmacies' chosen methods of dispensing and delivery. The bill would also require that nationally accredited Nebraska specialty pharmacies be allowed to participate in PBM specialty networks under reasonable contract terms.
Supporters — including hospital systems, infusion nurses, pharmacists at critical‑access hospitals, specialty clinicians and families — described repeated patient-care disruptions, delayed infusions, administrative waste and coverage disputes that they tied to PBM steering and white‑bagging mandates.
"This is an extremely inefficient and risky workflow," said Andrew Raduchel, director of Boys Town National Research Hospital, who walked the committee through a comparative workflow between the hospital‑administered model and white‑bagging. Multiple nurses and small‑hospital pharmacy managers testified that white‑bagging shipments arrive late, arrive to the wrong place, or require discarding costly doses that cannot be returned, causing rescheduled care and financial risk for small providers. "When a specialty medication does not show up," an infusion director said, "we just don't infuse it." Several witnesses said they had absorbed notable unreimbursed pharmacy costs after providing treatment when PBM‑supplied doses did not arrive.
Physicians described effects on clinical decision‑making and safety. "White‑bagging can cause serious, potentially harmful disruptions to patient care," Senator Bostar said in his opening; clinicians gave examples of delayed biologic therapy, lost continuity of care and dosing changes that were difficult to manage when a dose arrives from an external specialty pharmacy.
PBMs and insurers opposed portions of the bill or asked for different approaches. Blue Cross and Blue Shield of Nebraska and Prime Therapeutics argued that PBM credentialing and accreditation processes (URAC and similar standards) already secure delivery safety and quality, and that PBMs negotiate lower net prices and manage specialty distribution to control cost. They warned the bill could increase costs by steering care into higher‑priced settings. Insurers also noted that ERISA‑governed, self‑funded plans and some other plan types may be outside state authority.
Committee members questioned reimbursement levels, site‑of‑care effects (clinic vs. hospital pricing), supply‑chain tracking, and the interplay with federal programs. Witnesses on both sides agreed PBM contracting, rebates and vertical integration make a complex system where a mix of pricing incentives, patient‑safety issues and administrative friction intersects.
The hearing produced extensive proponent testimony and several opponents; committee action was not recorded in the transcript excerpt.
