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119-hr-7895119th CongressWALLET

PBM Kickback Prohibition Act

Sponsored By: Representative Allen, Rick W. [R-GA-12]

In Committee

Summary

Bans PBM kickbacks that pay for referrals or for shaping contracting decisions for employer-sponsored plans or insurers. The bill would also require written proof that payments to brokers or consultants reflect fair market value and are not tied to steering or contract design.

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  • Employers and plan sponsors: Stops compensation that rewards referrals or influences which pharmacy benefit manager is chosen or how plan business is steered. Plans and sponsors would need documentation to support any broker or consultant fees.
  • Brokers, consultants, and advisers: Payments to these firms are presumed to be linked to the prohibited activities unless contemporaneous written records show the fees are fair market value for real services.
  • Pharmacy benefit managers and insurers: Bars payments tied to referral, recommendation, placement, retention, renewal, or any role in requests for proposals, market checks, evaluations, or other contracting processes.
  • Timing: The rules would apply to plan years beginning after the date of enactment of the Act.

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Bill Overview

Analyzed Economic Effects

1 provisions identified: 0 benefits, 0 costs, 1 mixed.

Ban PBM referral payments

This bill would ban any payment by a pharmacy benefit manager or similar vendor that pays for referrals, recommendations, placement, retention, renewal, or access to a health plan's business. It would also bar payments tied to being included in or designing requests for proposals, market checks, evaluations, or measures of plan business. Compensation would be judged by economic substance, not by how the payer labels it. Payments to brokers or consultants would be presumed related to prohibited activity unless contemporaneous written proof shows fair market value for real services and no link to referrals. The rule would apply for plan years beginning after enactment. If passed, enrollees and employers could see lower drug-related costs over time, but plans and vendors could face higher compliance and contracting costs.

Sponsors & CoSponsors

Sponsor

Allen, Rick W. [R-GA-12]

GA • R

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

No roll call votes available for this bill.

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