# Plain Language Summary: Pharmacy Benefit Manager Transparency Act of 2022

This bill is about making pharmacy benefit managers (PBMs) more transparent about how they operate and what they charge. PBMs are middlemen companies that sit between insurance companies, pharmacies, and patients. They decide which medications are covered by insurance, negotiate prices with drug manufacturers, and determine how much you pay at the pharmacy counter. The problem is that much of what PBMs do happens behind closed doors, and many people believe this secrecy leads to higher drug prices and unexpected costs for patients.

The bill requires PBMs to disclose detailed information about their business practices, including how much money they make from different parts of their business, what fees they charge, and how they decide which drugs to cover or restrict. It also aims to prevent PBMs from engaging in practices that critics say artificially inflate drug prices, such as "spread pricing" (where PBMs pocket the difference between what they pay pharmacies and what they charge insurance companies) and steering patients toward more expensive medications. The bill would give state insurance regulators and the federal government more power to oversee PBM activities and hold them accountable.

If this bill becomes law, the main effect would be increased visibility into how drug prices are set and what's driving your medication costs. Supporters believe transparency and restrictions on PBM practices could lead to lower drug prices and more predictable out-of-pocket costs for patients. Pharmacies, particularly independent ones, would also benefit from clearer rules about how PBMs can treat them. However, PBMs argue that increased regulation could reduce their ability to negotiate lower prices with drug manufacturers, potentially raising costs elsewhere in the system.

Pharmacy Benefit Manager Transparency Act of 2022

Cantwell, Maria

Pharmacy Benefit Manager Transparency Act of 2022 This bill generally prohibits pharmacy benefit managers (PBMs) from engaging in certain practices when managing the prescription drug benefits under a health insurance plan, including charging the plan a different amount than the PBM reimburses the pharmacy. The bill also prohibits PBMs from arbitrarily, unfairly, or deceptively (1) clawing back reimbursement payments, or (2) increasing fees or lowering reimbursements to pharmacies to offset changes to federally funded health plans. PBMs are not subject to these prohibitions if they (1) pass along 100% of any price concession or discount to the health plan, and (2) disclose specified costs, prices, reimbursements, fees, markups, discounts, and aggregate payments received with respect to their PBM services. Further, PBMs must report annually to the Federal Trade Commission (FTC) certain information about payments received from health plans and fees charged to pharmacies. The FTC and state attorneys general are authorized to enforce the provisions of the bill.