Governor Hochul Signs Landmark Legislation Bringing Transparency and a Comprehensive Regulatory Structure to Otherwise Unregulated Pharmacy Benefit Managers
New York (STL.News) Governor Kathy Hochul has announced the signing of legislation S.3762/A.1396 which provides for licensure and registration of pharmacy benefit managers. The bill also sets forth duties and obligations that PBMs must follow when performing services and allows the department of financial services to enforce the law and receive complaints from consumers, pharmacies, and healthcare providers.
“In the midst of a global public health crisis, it’s crucial that we take every opportunity to improve the health care system and reduce costs for New Yorkers,” Governor Hochul said. “This landmark law creates the most comprehensive regulatory framework in the country for Pharmacy Benefit Managers, increasing transparency for consumers and shedding light on the cost of prescription drugs. Navigating costs associated with medications and insurance can be difficult, so I am proud to sign this legislation to make it that much easier.”
Legislation S.3762/A.1396 requires licensure for pharmacy benefit managers and specifies their duties and obligations as service providers. This bill also allows the department of financial services to receive complaints when a PBM violates the law and will ensure PBMs abide by standards established by law and regulation.
Acting Superintendent of Financial Services Adrienne A. Harris said, “The Department of Financial Services stands ready to implement this historic legislation which has been a long-standing priority of the Department. The regulation of Pharmacy Benefit Managers represents the next important step in tackling the impacts of high prescription drug prices on consumers and health insurance premiums. We are proud that Governor Hochul has secured the most comprehensive PBM regulatory regime in the country and are confident we will finally bring needed reforms to this previously unregulated industry.”
Senator Neil Breslin said, “The PBM industry has gone unregulated for long enough. PBMs, both here in New York and across the country have taken advantage of the lack of transparency at the expense of patients’ well-being. This patient centered legislation will hold PBMs to a standard of excellence that is required by all other stakeholders in our health care delivery system. Thank you to Governor Hochul for signing this critically important piece of legislation.”
Assemblymember Richard Gottfried said, “PBMs are widely recognized as major players in driving up drug costs. They’ve been a black box operating in secret without effective regulation, and PBM mistreatment of independent pharmacists is getting worse as health plans merge with chain pharmacies. This new law will provide effective oversight and transparency in this sector of the health care system. I thank Governor Hochul, Senate sponsor Neil Breslin, Assembly Speaker Carl Heastie, and my Assembly colleagues Kevin Cahill and John McDonald for their hard working turning this bill into law.”