Bill > HB1384

This bill mandates that by July 1, 2028, the Maryland Department of Health must select and contract with a single entity to act as the State Pharmacy Benefits Manager (SPBM). A Pharmacy Benefits Manager (PBM) is defined as a person or company that manages prescription drug benefits, including negotiating drug prices, processing claims, and managing formularies. The SPBM will be responsible for administering pharmacy benefits for all recipients of the Maryland Medical Assistance Program, including those enrolled in managed care organizations (MCOs), which are private companies contracted by the state to provide healthcare services to program recipients. Consequently, any new or renewed managed care contracts after July 1, 2028, will require MCOs to use the SPBM for their pharmacy benefits. To assist in selecting and contracting with the SPBM, the Department of Health will hire an independent consultant with specific experience in advising Medicaid fraud control units and working with states that have already established a single PBM for their Medicaid programs, ensuring this consultant has no conflicts of interest with MCOs or PBMs. The bill also outlines specific requirements for the SPBM contract, including establishing a fiduciary duty to the Department, mandating "pass-through pricing" (where the price charged to the program is the same as the price paid to the pharmacy), requiring the use of state-negotiated formularies and dispensing fees, demanding transparency in all drug-related costs and fees, and explicitly prohibiting "spread pricing," a practice where a PBM charges more than it pays for a drug.