Arizona lawmakers passed legislation last week prohibiting various forms of pharmacy benefit manager discrimination against 340B covered entities.
Gov. Doug Ducey (R) has not signaled if he will sign SB 1176, veto it, or let it become law without his signature, an Arizona 340B entity representative said. Republicans control the state House and Senate by slim margins. However, since the bills easily passed both chambers (53-0 in the House) and (24-2 in the Senate), the bill will likely be signed by the governor.
SB 1176 prohibits PBMs and health insurers from:
- discriminating in reimbursement on the basis that a pharmacy dispenses 340B drugs
- mandating higher fees or other financial burdens on the basis that a pharmacy dispenses 340B drugs
- excluding a pharmacy from a network on the basis that pharmacy dispenses 340B drugs
- restricting the methods or pharmacies within a network by which a 340B covered entity may dispense or deliver 340B drugs.
During committee consideration, covered entities fended off a push by PBMs to exclude hospitals from the bill’s protections, entity representatives said. Language was dropped that would have prohibited PBMs from requiring the use of claims modifiers to identify 340B-purchased drugs, they said. Language was added to clarify that the bill did not apply to physician administered drugs.
Arizona Alliance for Community Health Centers (AACHC) led the support for SB 1176. America’s Health Insurance Plans (AHIP), United Healthcare, Cigna, Blue Cross Blue Shield of Arizona, and CVS Health opposed the bill.