Shapiro signs pharmacy benefit manager reform legislation into law

WILKES-BARRE — Gov. Josh Shapiro this week followed through on his commitment to increasing transparency and accountability to support Pennsylvanians and local pharmacies by signing bipartisan House Bill (HB) 1993 into law, providing stronger protections for patients in Pennsylvania and increased regulatory oversight of pharmacy benefit managers (PBMs).

PBMs are the hidden “middlemen” of the pharmaceutical supply chain. They negotiate the price of prescription drugs between health insurance companies and drug manufacturers, set compensation formulas for pharmacy payments, and determine patient co-payments. Despite their influence and outsized role in our healthcare system, many Pennsylvanians are unaware of the existence of PBMs.

During his 2024-25 budget address, Gov. Shapiro called for legislation to reform the operations of PBMs to help Pennsylvanians impacted by the rising costs of prescription drugs and bring price transparency into the pharmaceutical supply chain.

HB 1993 grants the Pennsylvania Insurance Department (PID) the authority to regulate PBM practices and contains several important protections that will benefit Pennsylvanians, resulting in lower out-of-pocket costs for prescription medication.

“Pennsylvanians are getting screwed by the high cost of prescription drugs and too many rural pharmacies have been forced to close their doors, while the few PBMs that dominate the market are raking in billions,” Shapiro said. “My administration is doing everything in our power to cut costs and put money back in their pockets so they can receive the medication they need to live healthy lives while supporting our communities.”

Shapiro said he called for this overdue PBM reform in his budget address and the General Assembly came together in a bipartisan manner to cut costs and safeguard healthcare access for all Pennsylvanians.

“This is another example of the big things we can do to make a difference in Pennsylvanians’ lives when we work together,” Shapiro said.

According to the Center for Rural Pennsylvania, approximately 540,000 rural Pennsylvania residents lived in a pharmacy desert at least five miles from the nearest pharmacy in 2022.

Since January 2024, more than 140 pharmacies have closed in Pennsylvania according to the ACT Pharmacy Collaborative, and the Pennsylvania Pharmacists Association estimates that over 70 of those pharmacies are independently run. Currently, 21 of Pennsylvania’s 67 counties already have fewer than 10 pharmacies.

HB 1993 provides several tools to help Pennsylvania address these issues:

• HB 1993 will prohibit certain “steering” practices, such as requiring a policyholder to purchase drugs exclusively through a mail order pharmacy or at a pharmacy owned or controlled by the PBM.

• HB 1993 prohibits a pharmacy from charging a price that is more than the consumer would pay if they walked in off the street and paid in cash or that is more than the pharmacy would receive from the insurer or PBM.

• HB 1993 contains robust network adequacy requirements that require a PBM to establish a network that meets or exceeds federal Medicare access standards. This will ensure Pennsylvanians always have a pharmacy within a reasonable distance to fill their prescriptions.

This law also prevents PBMs from hiding certain predatory practices that drive up profits by requiring the submission of several reports to PID, including one that requires each PBM to disclose all the manufacturer rebates it receives and does not pass through to its clients. Another report will require each PBM to disclose the adequacy of its pharmacy networks. Both reports will be posted on PID’s website after full implementation in 2026.

“The Governor has been clear that it is past time to reform the operations of PBMs for the protection of Pennsylvanians, and that is exactly what HB 1993 does,” said Pennsylvania Insurance Commissioner Michael Humphreys.

The law has a staggered effective date. However, all provisions of the new law will be applicable to health insurance policies approved and pharmacy contracts issued, renewed, or amended after Nov. 14, 2024.

Treasurer Garrity commends General Assembly, Gov. Shapiro for $737M Rainy Day Fund increase

Pennsylvania Treasurer Stacy Garrity this week praised the General Assembly and Gov. Josh Shapiro for adding about $740 million to the state’s Rainy Day Fund as part of the state budget for Fiscal Year 2024-25 — bringing the state’s reserve fund to a record high, nearly $7 billion.

“Building Pennsylvania’s Rainy Day Fund strengthens our fiscal outlook as we prepare for the future,” Garrity said. “When I took office, we had one of the worst reserve funds in the country — the Rainy Day Fund was so small that it would barely cover the Commonwealth’s bills for two days. Now, thanks to four consecutive years of strong savings, we’re well above the national median. A big part of responsible budgeting is setting money aside when you can, and I strongly support this smart decision by the General Assembly and the Governor.”

The balance of the state’s reserve fund, currently $6.25 billion, will increase to approximately $6.987 billion when the deposit is made. That’s enough money to run the Commonwealth for 53.6 days. According to The Pew Charitable Trusts, the national median is 46.0 days.

In November, Treasurer Garrity announced that the Treasury Department created a new investment pool dedicated exclusively to the Rainy Day Fund. The new pool is creating greater investment returns for the fund while maintaining necessary liquidity.

The Rainy Day Fund, formally known as the Budget Stabilization Reserve Fund, provides a fiscal safety net for possible economic downturns to help prevent tax hikes and cuts to discretionary programs.

DMVA grants available to eligible veterans, beneficiaries who face unexpected hardships

The Pennsylvania Department of Military and Veterans Affairs (DMVA) this week said it is offering financial assistance to veterans who are facing an unexpected financial hardship.

The Veterans Temporary Assistance (VTA) program provides eligible Pennsylvania veterans and their beneficiaries with financial relief for necessities of life such as food, shelter, fuel, and clothing.

“The VTA grants have helped thousands of veterans and their families who have fallen on hard times financially,” said Maj. Gen. Mark Schindler, Pennsylvania’s adjutant general and head of the DMVA. “By ensuring that all eligible veterans and beneficiaries receive the help they need when a hardship arises, we are sending a clear message that you are not alone, help is available, and we appreciate all you have done for our nation. We encourage everyone who needs assistance and meets the requirements to apply.”

Since the inception of the VTA, DMVA has awarded more than $6.7 million to assist over 4,800 service members, veterans, and their families with emergent financial needs.

Eligible veterans or their beneficiaries can qualify for an amount not to exceed $1,600 in a 12-month period. Eligibility requirements include: a person who served in the Armed Forces of the United States (discharged under honorable conditions), died in service or was killed in action, or suffered a service-connected disability.

For more information about the program’s criteria, eligibility and needed documentation, go to Veterans Temporary Assistance page on the official Pennsylvania government website. To apply, eligible veterans should contact the County Veterans Affairs Directors in the county in which they reside.

Ready-to-drink cocktails bill is signed into law

After a multi-year effort, liquor will be sold outside of the state store system with the passage of legislation championed by Sen. Mike Regan (R-31).

“This is monumental,” Regan said. “For the first time in 91 years, Pennsylvania consumers will be able to buy liquor-based alcohol to go at their local grocery store, convenience store, beer distributor or restaurant.”

The Pennsylvania Liquor Control Board (LCB) dates back to the end of Prohibition in 1933. With the LCB came state-run liquor stores, the only place in the commonwealth where consumers have been allowed to purchase spirits-based alcohol for off-premises consumption.

Regan’s Senate Bill 688 changes that by allowing licensed retailers to sell ready-to-drink canned cocktails (RTDs) made with spirits, such as vodka and tequila, with an alcohol by volume (ABV) of 12.5% or less.

“We are putting a product on the shelves that is similar in ABV and very similar in look and concept to malt-based canned cocktails that consumers can already access at their local retailers,” Regan said. “We are not putting high-alcohol-content products on the shelves of grocery and convenience stores.”

As with many legislative initiatives, compromises were made to get this historic legislation across the finish line.

“This is in no way the most cost-effective or efficient way of getting RTDs on the shelves of retailers,” Regan said. “That part has been left out because the unbreakable union entanglement in liquor issues has once again unnecessarily put self-interest above all else. Despite this, we have still achieved something that no one in the Legislature has done in 91 years. We are allowing consumers the ability to buy spirits-based products along with wine, beer and even their groceries.”

Senate Bill 688 was signed into law Wednesday by Gov. Josh Shapiro as Act 86 of 2024.