HF3922

Purpose

To improve patient access to pharmacy services and support the financial viability of community pharmacies. The bill sets a minimum total reimbursement for any prescription drug dispensed by a community pharmacy. This minimum is the drug’s NADAC (or WAC if NADAC isn’t available) plus a professional dispensing fee, with the total adjusted every two years based on an independent cost-of-dispensing survey. It also clarifies how 340B drugs are reimbursed and aims to stop practices by PBMs and MCOs that reduce pharmacy pay.

Main Provisions

• Minimum reimbursement standard
  • For every prescription a community pharmacy dispenses, the total reimbursement must be no less than:
  • NADAC (National Average Drug Acquisition Cost), or if NADAC isn’t available, the Wholesale Acquisition Cost (WAC), plus
  • a professional dispensing fee (as defined in state law), with the amount adjusted biennially based on an independent cost-of-dispensing survey that reflects inflation, labor costs, and operating expenses.
  • Drugs purchased under the federal 340B program are not required to be reimbursed at NADAC/WAC; instead, their reimbursement follows applicable federal and state law.
• Prohibition of below-cost reimbursements and negative adjustments
  • Pharmacy Benefit Managers (PBMs) and Managed Care Organizations (MCOs) cannot provide reimbursements that are below the required standard.
  • No negative reimbursement adjustments, including fees or charges that decrease the total paid to a pharmacy for any prescription.
  • Parity in reimbursement: PBMs may not pay PBM-owned or affiliated pharmacies more than community pharmacies for the same drug and under the same patient and plan conditions.
  • No direct or indirect fees that reduce net reimbursement to below the required standard (examples given include transaction fees, recoupments, adjustments, and network access fees).

Significant Changes to Existing Law

• Establishes a clear floor for pharmacist reimbursement tied to NADAC/WAC plus a dispensing fee, with regular biennial updates based on an independent cost-of-dispensing survey.
• Creates a requirement that PBMs and MCOs not engage in practices that lower net reimbursement or create unfair disparities between community and PBM-owned/affiliated pharmacies.
• Adds explicit protections against negative adjustments and certain fees that erode pharmacist earnings.
• Defines how 340B drug reimbursements are to be handled separately from the NADAC/WAC-based floor, in line with federal and state law.
• Codifies these rules into Minnesota statutes (section 62J.901), affecting how pharmacies are reimbursed for all dispensed prescriptions.

How this bill would affect pharmacies and patients

• Community pharmacies would have a higher, more predictable minimum reimbursement for most prescriptions, improving financial stability.
• Patients could benefit from more consistent access to pharmacy services when reimbursement is fairer.
• PBMs and MCOs would face tighter rules to avoid reducing pharmacist revenue or creating inequities between pharmacy types.

Relevant terms

• NADAC (National Average Drug Acquisition Cost)
• WAC (Wholesale Acquisition Cost)
• Professional dispensing fee
• Independent cost-of-dispensing survey
• 340B program
• PBM (pharmacy benefit manager)
• MCO (managed care organization)
• Reimbursement standard
• Negative reimbursement adjustments
• Parity in reimbursement
• Transaction fees
• Network access fees
• Recoupments
• Net reimbursement
• Community pharmacy

Relevant Terms (plain list) NADAC, WAC, professional dispensing fee, cost-of-dispensing survey, 340B, PBM, MCO, reimbursement, parity, negative adjustments, transaction fees, network access fees, recoupments, net reimbursement, community pharmacy