House committee advances PBM reform and creates prescription drug affordability board amid debate

The House Insurance Committee on April 29 advanced a package of bills aimed at changing how pharmacy benefit managers operate and how prescription drug prices are reviewed in Louisiana.

Senate Bill 387, sponsored in the Senate and presented in committee by Sen. (Talbot/Bass as introduced in the transcript), seeks to restrict certain PBM practices by requiring pass‑through of rebates to plan sponsors, limiting PBM compensation to fixed fees or limited performance bonuses, expanding audit authority, and imposing fiduciary duties to enrollees. The committee also took up Senate Bill 401, which would establish a Prescription Drug Affordability Board to collect manufacturer pricing and reporting data and produce reports to help legislators evaluate potential policy responses. Committee members adopted multiple amendment sets that narrowed scope, clarified confidentiality, and delayed some implementation dates (amendment 4624 adjusted some effective dates to 2028 and added audit/confidentiality language tied to the affordability board).

Why it matters: Supporters said the measures create transparency that can reveal how list prices, rebates and other arrangements affect patients, plan sponsors and uninsured Louisianans. Jason Young, cofounder of Americans for Lower Drug Prices, described SB401 as a “smoke detector” that provides data necessary for sound policy and noted similar reporting regimes exist in other states. Josh Sonnier of the Louisiana AFL‑CIO said transparency helps fiduciaries and plan trustees identify where costs are occurring and protect members’ interests.

Opponents, including the Pelican Institute and the Pharmaceutical Care Management Association, warned the bills could upend privately negotiated contracts and reduce flexibility employers and plan sponsors use to lower costs. Phil Cristo Fanelli of PCMA said the proposals would replace value‑based contracting with a one‑size‑fits‑all mandate and risk higher premiums, fewer design options and reduced competition. Industry witnesses also raised concerns about broad audit powers and potential legal and administrative burdens.

Discussion focus and unresolved points: Committee members pressed sponsors on several issues, including whether ERISA‑covered plans were carved out, how the affordability board would select “critical” drugs for review and the criteria for inclusion; sponsors pointed to statutory language requiring the board to consider cost, public interest and extent of use and noted a two‑year sunset and minimum meeting frequency in amendments. Members also debated the impact on municipal and school plans; testimony from an officer of a government benefits program (OGB) warned most non‑ERISA plans are government plans and would be affected.

Vote and next steps: Representative Bamberg moved to report SB387 favorably, Representative Freeman objected, and the committee held a roll call. The committee recorded 10 yeas and 4 nays and reported SB387 with amendments. The transcript shows SB401 was also reported as amended. Both bills will proceed from the committee to the next stage of the legislative process.

Attribution: Quotations and specific testimony attributed in this account are drawn from committee witnesses and members recorded in the hearing transcript, including Jason Young (cofounder, Americans for Lower Drug Prices), Josh Sonnier (Louisiana AFL‑CIO), Laurie Adams (Pelican Institute) and Phil Cristo Fanelli (PCMA).