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Arkansas Insurance Department warns PBMs: NAADAC/MAC violations under review; fines possible
Summary
Insurance Department officials told the committee they have seen a recent surge of pharmacy complaints alleging PBM reimbursement below NAADAC and MAC thresholds, and said they will pursue enforcement including fines, license suspensions and possible legislative fixes to increase penalties.
Booth Rand and Beth Barrington of the Arkansas Insurance Department told the Senate Public Health, Welfare and Labor Committee that the department is actively enforcing state rules that require pharmacy benefit manager reimbursements at least at NAADAC levels and not below a pharmacy’s invoice or MAC where applicable.
Rand described a recent increase in complaints — roughly 50 in six weeks — from mostly independent pharmacies alleging reimbursement violations. The department said it has authority to impose fines (up to $50,000 per six‑month period for patterns of violations), to suspend or revoke PBM licenses, and to require corrective adjustments. Barrington, who recently joined the PBM division, explained staffing turnover created a temporary complaint backlog but said the office has largely caught up and is engaging with PBMs to improve MAC and NAADAC systems.
Committee members asked whether the department can pursue retroactive civil damages; Rand said administrative fines and license actions are within the department’s authority, while civil retroactive claims fall to the Attorney General’s office. Lawmakers discussed expanding statutory penalties to permit per‑violation fines instead of per‑pattern fines; the department is working with legislators on potential drafting.
The department said it had recently met with PBM industry representatives and received a commitment to improve systems. Rand said if PBMs do not improve systems quickly, the department will consider pursuing stronger enforcement actions next month.
