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Senate passes bill to increase PBM transparency, limit pharmacist 'gag' restrictions
Summary
Senators adopted a second substitute for Senate Bill 208 requiring greater transparency from pharmacy benefit managers (PBMs) about DIR fees and preventing certain contract terms that would bar pharmacists from informing patients about cheaper cash options. The measure passed the Senate unanimously and moves to the House.
The Utah Senate adopted a second substitute to Senate Bill 208, which sponsors described as addressing two problems in pharmacy benefit management: opaque DIR fee clawbacks and contractual terms that can bar pharmacists from telling patients about cheaper payment options.
Sponsor Senator Vickers told colleagues the bill asks PBMs to provide transparent reporting on DIR fees so pharmacies and plan managers can see how those fees are assessed and what actions would reduce them. On the so-called "gag order," the sponsor said some PBM contracts contain clauses that preclude pharmacists from telling patients when paying cash would be cheaper than using insurance; SB208 would prevent that restriction.
"What Mr. President Pro Tem, I am open for questions," the sponsor said after describing the bill's intent language and reporting requirements. The floor waived summation, the sponsor moved SB208 to third reading, and the Senate recorded 24 aye votes, 0 nay, and 5 absent. President Niederhauser announced the bill would be read for a third time, advancing it toward final passage.
Supporters framed the bill as a business-practice transparency reform that would protect small pharmacies and patients from unexpected clawbacks and non-transparent fee accounting. The sponsor said the bill would not prevent pharmacists from helping patients find lower-cost alternatives.
What’s next: SB208 will go to the House for consideration; sponsors indicated stakeholder language was reviewed in committee and the floor substitution reflects negotiated clarifications.
