Senate Committee Considers Major PBM Reform Bill

Significant pharmacy benefit manager (PBM) reform legislation was heard on April 26 by the Senate Health and Human Services Committee. Senate Bill 1137 by Sen. Charles Schwertner would apply laws passed last session to protect patients and pharmacies to all PBMs operating in Texas. Last session, the legislature overwhelmingly adopted two bills aimed at reforming PBM practices to ensure healthy competition in the pharmacy space.

“As good as that legislation was, it only applied to certain health plans subject to Texas Department of Insurance (TDI) oversight, causing confusion among patients and pharmacists about which set of rules apply,” said Texas Pharmacy Association CEO Debbie Garza. “SB 1137 would eliminate this guessing game by putting the same standards and protections in place for all PBMs operating in Texas.” She also explained that nothing in SB 1137 requires any pharmacies to be paid more than current amounts, but it would ensure competition and increase transparency in the prescription drug market.

TPA Board Member Rannon Ching testified about how the bill would broaden the prohibition on PBMs from steering patients to pharmacies they themselves own, especially when it comes to high-dollar specialty drugs. “PBMs routinely create barriers to prevent community pharmacies like ours from dispensing these medications,” he said. “These restrictions are not about patient safety or quality, but are purely about forcing expensive, and therefore profitable, medications to their own pharmacies.”

Click here to view video of the hearing; discussion of SB 1137 begins at 0:00:52 and TPA testimony begins at 0:04:45. Click here to view additional testimony on this bill that begins at 2:10:40.