Nebraska Senate advances LB 198 to enhance pharmacy benefit manager regulations

The Nebraska Legislature convened on May 1, 2025, to discuss significant amendments to the Pharmacy Benefit Manager (PBM) Licensure and Regulation Act, specifically focusing on LB 198. This bill aims to enhance the regulation of PBMs, which play a crucial role in managing prescription drug benefits for health plans, including the Nebraska State Medicaid program.

Senator Sorrentino introduced LB 198, which has undergone substantial revisions through Committee Amendment 12:01. This amendment incorporates provisions from both LB 198 and another bill addressing white bagging practices, reflecting extensive collaboration among various stakeholders, including the Nebraska Pharmacists Association and Blue Cross Blue Shield of Nebraska. The consensus reached among these groups indicates strong support for the amended bill.

Key provisions of LB 198 include prohibiting PBMs from engaging in spread pricing, a practice where they charge health plans more for medications than what they reimburse pharmacies. The amendment also seeks to ensure fair treatment of independent pharmacies, allowing them to refuse dispensing drugs if reimbursement falls below acquisition costs, thereby protecting their financial viability.

Additionally, the amendment aims to improve patient access to medications by preventing health plans from mandating the exclusive use of mail-order or affiliated pharmacies. It emphasizes the importance of patient choice, allowing individuals to select their preferred local pharmacies without facing penalties.

Senator Jacobson, chair of the Banking and Insurance Committee, highlighted that the amendment represents a significant step towards transparency and fairness in the PBM industry. It sets clear expectations for specialty pharmacies and addresses the complexities surrounding clinician-administered drugs, ensuring timely delivery and adherence to safety standards.

The discussions during the session underscored the importance of regulating PBMs to protect consumers and local pharmacies while promoting equitable healthcare practices in Nebraska. The bill is seen as a foundational step, with plans for further studies and discussions on PBM regulations in the future.