Alabama Senate passes PBM reform bill after hours of debate and amendments

The Alabama Senate on Monday passed Senate Bill 252, a measure aimed at reforming pharmacy benefit manager (PBM) practices, after several hours of debate and multiple amendment votes.

The bill, sponsored on the floor by Senator Beasley, passed final passage on a roll call of 32 ayes, 0 nays and 1 abstention. Supporters said the measure is meant to address what they described as long-running problems in how PBMs set formularies, require use of PBM-owned mail-order pharmacies, and calculate reimbursements to retail pharmacies.

Senator Beasley, the bill sponsor, framed the legislation as an effort to protect community pharmacies from contracting and reimbursement practices that he said have reduced retail pharmacies' ability to operate. “Nothing in this bill will push higher prices to the consumer,” Senator Beasley said on the floor, adding that the legislation is aimed at commercial plans and will not affect Medicare or Medicaid.

Why it matters: Sponsors and backers said the bill responds to sustained closures of independent drugstores in Alabama. Senator Jones warned that delays to the bill would result in more closures: “Every month that we delay this bill, you can count on about 3 more pharmacies closing their doors,” he said during debate.

Key debate and amendments: The Senate considered several amendments that would have altered the timing of the reimbursement provisions. Senator Elliott offered an amendment that he described as limiting the change to the reimbursement portion and postponing its effective date; he said, “this amendment deals with the effective date of the reimbursement portion only of the legislation.” That amendment failed on a roll call (10 ayes, 21 nays, 1 abstention). A separate amendment from Senator Stutz similarly failed (5 ayes, 27 nays, 1 abstention).

Later on the calendar the Senate adopted an amendment offered by Senator Gudger. The transcript record shows the Gudger amendment passed on the long roll by 31 ayes, 0 nays, 1 abstention; the surviving amendment language as adopted revised provisions of the bill, including timing and sunset language described on the floor as part of intermember negotiations. The sponsor and other senators described the final package as a bipartisan compromise crafted after floor negotiations.

Votes and process: The sequence on the floor included adoption of committee amendments, failed and withdrawn amendments addressing implementation dates, and floor negotiation that produced the amendment ultimately adopted. The final passage vote for Senate Bill 252 was 32 ayes, 0 nays, 1 abstention. The transcript records an abstention from Senator Weaver during earlier action on a related resolution; the final roll call shows one abstention but does not record the name in the final roll call statement. Several senators asked for more time to refine implementation timing and for language to avoid unintended fiscal-year impacts on state payers; proponents said they had worked to protect consumers and state programs.

What the bill does (as described on the floor): Sponsors described the measure as (1) requiring PBM transparency over formularies and rebates, (2) directing certain rebates back to the employee benefit plan rather than PBMs, and (3) changing reimbursement formulas to better reflect retail pharmacies' costs. The sponsors repeatedly emphasized that the bill’s provisions target commercial pharmacy benefit arrangements and that they did not intend to change Medicare or Medicaid rules.

Remaining questions and next steps: The transcript shows senators agreeing to continue technical work on implementation timing and contract coordination (including interplay with employer contracts and Medicaid), and at least one senator said a further amendment setting an October 1 effective date would be introduced and considered. The House will now receive the bill; any differences that body makes would have to be reconciled before the bill could be sent to the governor.

Ending note: Senate leaders and floor sponsors characterized the final measure as a bipartisan product of negotiation intended to preserve community pharmacies while minimizing impact on consumers and state programs. Supporters hailed the passage as a win for local pharmacies; opponents and cautious senators pressed for careful implementation timing to avoid budget-year disruptions.