General updates.

New Idaho PBM legislation.

Idaho recently passed House Bill 596 (H0596aaS) which imposes the following new requirements on Pharmacy Benefit Managers:

• Spread pricing is now prohibited. 
• PBMs are required to provide full pass-through of prescription drug rebates to clients.
• PBM disclosure and reporting requirements. 
• An extensive list of standards for contract terms between PBMs and pharmacy benefit plans/programs.
• Contracts must apply network adequacy requirements, restrict mandatory mail-order programs, and require a designated continuity of care period following formulary changes.
• PBM contracts must require dispensing fees for network pharmacies that “reasonably cover the costs of dispensing medications.”

The Department of Insurance may provide further guidance for required dispensing fee amounts as well as other bill provisions.  
Industry representatives objected to the legislation because of the potential cost impact to plans, additional administrative burdens, and interference with private contracting. A number of amendments were proposed to try and create more balanced legislation, but few changes made it into the final law. Questions were also raised about federal preemption for attempting to indirectly regulate self-funded plans governed by ERISA.

Governor Little acknowledged concerns in a letter indicating that he had signed with reluctance and that there was an “expectation that stakeholders will monitor these concerns and are prepared to act accordingly in future legislative sessions until we find the right resolution for Idaho businesses and consumers.” With the new law effective January 1, 2025, Select Health will continue to monitor implementation efforts and share updates for any further guidance.