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Committee hears bill to force PBMs to pass rebates to patients; bill postponed indefinitely
Summary
SB 1078 would require pharmacy benefit managers to pass a large share of manufacturer rebates through to patients at the point of sale. Supporters said it would lower out-of-pocket costs for people with chronic conditions; insurers and PBMs warned of higher premiums and fiscal effects. The committee voted to pass by indefinitely (PBI).
Senator Peake presented SB 1078, a bill that would require pharmacy benefit managers (PBMs) to pass negotiated manufacturer rebate savings through to patients at the pharmacy counter. Supporters — including patient advocates representing diabetes and other chronic conditions — told the committee rebates negotiated by PBMs are not currently passed to patients at point of sale, leaving patients paying higher out-of-pocket costs.
Three patient witnesses described the effect of high prescription drug costs: one said insulin and other chronic medications produced substantial out‑of‑pocket burdens when deductibles reset. Erin Callahan and other witnesses representing patient-advocacy groups urged the committee to prioritize point-of-sale rebate pass-through to reduce immediate patient expenses.
PBMs, health-plan representatives and trade groups testified in opposition. Doug Graham of the Virginia Association of Health Plans and other witnesses argued rebates are used to lower plan premiums and that mandating point-of-sale rebate pass-through could raise premiums and increase costs for employers and other covered populations. Industry witnesses said state-level mandates that do not apply to ERISA plans raise preemption and implementation concerns.
After testimony from both sides, committee members discussed policy and fiscal implications. Senator Peake asked the committee to report the bill for finance review; after debate the committee moved to pass SB 1078 by indefinitely (PBI), leaving the measure alive but off the immediate docket for further consideration.
Supporters said the measure would help patients living with diabetes and other chronic disease who face high co-pays and deductibles; opponents said the state-level policy could have unintended consequences for premiums and plan design.
