SB 1164 – Arizona

Status: In Process
Year Introduced: 2024

This bill amends title 20, chapter 25, article 2 of the Arizona Revised Statutes, establishing regulations for Pharmacy Benefit Managers (PBMs). PBMs are third-party administrators of prescription drug programs. The bill prohibits PBMs from limiting or eliminating coverage for a prescribed drug pre-approved by the PBM or healthcare insurer, as long as the patient continues to be enrolled with the health insurance that the PBM is contracted with. PBMs also cannot reduce maximum coverage, increase cost sharing, move a drug to a more restrictive formulary tier, or remove a drug from the formulary except under certain conditions. The bill mandates that if any changes are made by a PBM or healthcare insurer during a plan year, they must notify affected individuals and their prescribing healthcare provider in writing at least 60 days prior to the change. The bill establishes prescription drug coverage exemption determination processes and stipulates that denials of coverage must be made in writing by a licensed pharmacist or medical director, providing an explanation for the denial. If a PBM or healthcare insurer violates these regulations, the director can impose a civil penalty. These laws apply to contracts entered into, amended, extended, or renewed on or after 31st December 2024.

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