Lawmakers debate PBM, pharmacy rules and reimbursement; pharmacy groups urge cost-plus dispensing fee

Senate Bill 140, a wide-ranging bill addressing pharmacy benefit managers (PBMs), vertical integration, pharmacy reimbursement and network rules, drew lengthy testimony for and against measures that would change how pharmacies are reimbursed and how PBMs contract in Indiana.

Sponsor overview and amendment debate

Senator Charbonneau, the bill sponsor, described SB140 as an effort to limit vertical integration and increase transparency in pharmacy benefits. The bill includes prohibitions on PBMs or insurers holding interests in pharmacies, requires PBMs to demonstrate network adequacy and create a complaint process, and would give the state the authority to contract for PBM services or create a public–private "pharmacy benefit partner" for state plans.

Senator Zay presented a proposed amendment (amendment No. 10) that would go further by authorizing the state personnel department to issue an RFP for a single PBM or a public–private PBM partner for the state employee plan and would require pass-through of 100% of rebates to the state plan under that contract. State health staff said the administration supports exploring such contracting but called some of Zay's amendment language too prescriptive and recommended retaining flexibility in the RFP process.

Pharmacy testimony and independent owners

Darren Covington of the Indiana Pharmacy Association and multiple independent pharmacy owners testified in strong support of major provisions in SB140. They told the committee that a wave of pharmacy closures in Indiana — roughly 100 closures over two years, per the association’s data cited in…