The Regulatory Framework (B) Task Force established a new subgroup to evaluate the need for additional regulation of pharmacy benefit managers (PBMs). This work is part of a broader discussion occurring at the Health Insurance and Managed Care (B) Committee and within its related working groups regarding health care cost drivers, including pharmaceutical costs. PBMs are facing increased scrutiny following President Trump’s recently announced policy proposals to lower prescription drug costs, including the potential elimination of “middlemen” such as PBMs involved in the delivery of prescription drug benefits.
Members of the Task Force noted that, in connection with the development of recent amendments to the NAIC’s Health Carrier Prescription Drug Benefit Management Model Act, the Task Force had decided early on to regulate PBMs indirectly, by providing that the health carrier must ensure that the PBM is complying with the requirements of the laws and regulations applicable to the activities performed by the PBM. However, because of the increased scrutiny on PBMs, at the Summer Meeting, the Task Force decided to form a subgroup to review existing state licensing regimes applicable to PBMs and to explore the appropriate regulatory framework, if any, to be developed with respect to the licensure of PBMs. The Task Force is aware that the National Council of Insurance Legislators (NCOIL) is drafting a Pharmacy Benefits Manager Licensure and Regulation Model Act, which would give state insurance regulators increased jurisdiction over the activities of PBMs. The NCOIL model is based on recently adopted Arkansas legislation addressing the regulation and licensure of PBMs. It is expected that the Task Force’s newly formed subgroup will consider whether the NAIC should support NCOIL’s proposed PBM legislation or, alternatively, develop additional NAIC guidance related to the regulation of PBMs.