Indiana enacts new pharmacy benefit manager regulations effective 2025

House Bill 1604, introduced in the Indiana House on April 23, 2025, aims to regulate the practices of pharmacy benefit managers (PBMs) in relation to prescription drug cost-sharing. The bill seeks to ensure that individuals covered by health plans administered by PBMs are not subjected to excessive out-of-pocket costs for essential medications, particularly those that are life-saving or necessary for managing chronic pain.

Key provisions of the bill include the requirement for PBMs to apply annual cost-sharing limits as outlined in the federal Affordable Care Act to specific prescription drugs that lack approved generic alternatives. This measure is designed to protect patients from high costs associated with these critical medications. Additionally, the bill mandates that all cost-sharing amounts, whether paid directly by the individual or on their behalf, be included in the calculation of their financial contributions towards their health plan's cost-sharing requirements.

Notably, the bill also restricts PBMs from influencing health plan coverage terms based on the availability of financial assistance for prescription drugs. This provision aims to prevent potential conflicts of interest that could arise if PBMs were allowed to alter coverage based on external financial support.

The introduction of House Bill 1604 has sparked discussions among lawmakers, healthcare advocates, and industry stakeholders. Supporters argue that the bill is a necessary step towards making essential medications more affordable and accessible, particularly for vulnerable populations. Critics, however, express concerns about the potential implications for PBMs and the overall healthcare market, fearing that such regulations could lead to increased costs for health plans or limit the availability of certain medications.

The bill is set to take effect in stages, with certain provisions beginning on July 1, 2025, and others on January 1, 2026. As the legislative process unfolds, the implications of House Bill 1604 could significantly impact the landscape of prescription drug pricing and access in Indiana, potentially serving as a model for similar initiatives in other states. The ongoing debates surrounding the bill will likely shape its final form and effectiveness in addressing the pressing issue of medication affordability.