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Senate committee reviews PBM licensing rule, regulators seek stronger penalties for below‑cost pharmacy payments
Summary
The Senate Insurance & Commerce Committee reviewed amendments to Rule 118 to align with 2023 PBM licensure law and discussed enforcement of NADAC-based underpayments. Insurance officials said about 1,500 below‑NADAC complaints arrive monthly and urged higher fines to force PBMs to fix systems; lawmakers sought drafting changes to preserve discretion.
The Senate Insurance & Commerce Committee reviewed proposed amendments to Rule 118 on pharmacy benefit manager (PBM) licensing and enforcement, as the Arkansas Insurance Department sought to align its rule with 2023 PBM licensure legislation and tighten penalties for PBM violations.
Booth Rand, general counsel for the Arkansas Insurance Department, told the committee the change would confirm the department’s jurisdiction over PBMs administering plans issued outside Arkansas that cover Arkansas residents and would increase penalties for paying pharmacies below acquisition cost. Rand said the department is revising the rule to reflect the legislature’s decision to remove a previous $50,000 aggregate cap and to apply a $5,000-per-violation penalty with no aggregate limit under the current draft. He also noted Rule 128 — a separate rule addressing fair and reasonable pharmacy reimbursement — will be considered by an executive subcommittee.
The department has set a public hearing on the Rule 118 amendments for next week and said…
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