Recently, the New York Department of Financial Services (DFS) withdrew a proposed regulatory package aimed at overseeing the activities of pharmacy benefit managers (PBMs), and simultaneously announced its’ finalization of separate regulations related to PBM licensing.
DFS’s efforts to regulate PBMs originated from legislation enacted in 2021, and subsequently amended in 2022, which tasked DFS with licensing PBMs and addressing widely criticized PBM industry practices. The original proposal would have required PBMs to pay pharmacies a minimum benchmark price for drugs along with an additional “dispensing fee” of $10.18 for each prescription. Opponents of the regulations argued that the fee alone would place substantial financial burdens on the companies, potentially resulting in billions of additions costs. Concerns were raised that such expenses would likely be passed on to health plans, employers, and, ultimately, consumers. On the other hand, pharmacies supported the proposals, asserting that PBMs possess excessive market power and offer disproportionately low reimbursements to maximize their profits. While this proposal was not adopted, DFS did establish new regulations for PBMs to obtain a license to operate in the state by January 1, 2024. For more information, view the regulations here.
Last Updated on December 19, 2023 by Aimed Alliance
