Maryland Gov. Larry Hogan (R) has signed legislation prohibiting pharmacy benefit manager (PBM) discrimination against 340B covered entities and their contract pharmacies.
Hogan signed HB 1274 into law on May 16. It takes effect Oct. 1. The state House and Senate both passed it unanimously. The state hospital association, national, regional, and state health center associations, and the state chain drug store association backed its passage. National PBM trade group Pharmaceutical Care Management Association (PCMA), the Maryland life and health insurance industry association, and health insurer Cigna testified against it.
The new law requires PBMs to
- make non-discriminatory formulary and coverage decisions for 340B entities and pharmacies
- let beneficiaries pick any in-network pharmacy without regard to 340B status.
It forbids PBMs to
- transfer 340B savings from entities or their pharmacies to themselves
- offer lower reimbursement for 340B-purchased drugs
- refuse to cover 340B-purchased drugs
- refuse to let a 340B pharmacy participate in the PBM’s network solely due to the pharmacy’s 340B status
- impose discriminatory reimbursement or network adequacy terms based on 340B status
- impose discriminatory fees, chargebacks, or other adjustments based on 340B status
- modify a beneficiary’s copayment based on a pharmacy’s 340B status.
Maryland is the 20th state to enact 340B anti-discrimination legislation since 2019.