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ColoradoHB25-10942025 Regular SessionHouseWALLET

Pharmacy Benefit Manager Practices

Sponsored By: Byron Pelton (Republican), Dusty Johnson (Republican), Dylan Roberts (Democratic), Kyle Brown (Democratic)

Signed by Governor

Health Care & Health Insurance

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Bill Overview

Analyzed Economic Effects

4 provisions identified: 2 benefits, 0 costs, 2 mixed.

Health plans face drug preference limits

Beginning January 1, 2027, pharmacy benefit managers cannot favor a brand-name drug over an equivalent generic or biosimilar. A brand-name drug can be preferred only when its net acquisition cost is lower and consumers pay less out of pocket. Managers can negotiate limits on wholesale acquisition cost increases for drugs on their covered-drug lists and in benefit designs. They can still negotiate rebates or discounts as a share of list price. The law does not require price-limit agreements or set a household savings amount.

Health plans get drug cost oversight

Health plan contracts must require pharmacy benefit managers to provide drug-cost reports, including claim details and prohibited income subject to pass-through. Reports are free and due within 30 days after plan notice, or at agreed regular intervals needed to check compliance. Contracts must allow annual compliance audits, and Colorado’s Insurance Commissioner can issue enforcement rules. The law applies to conduct beginning January 1, 2027. A referendum petition filed within 90 days after final adjournment suspends challenged provisions pending approval at the November 2026 general election; approved provisions start January 1, 2027, or the governor’s official vote declaration date, whichever is later.

New pay limits for drug managers

Beginning January 1, 2027, Colorado allows pharmacy benefit managers (PBMs) to earn a single flat-dollar service fee for providing a prescription drug. Written health plan agreements must clearly state the fee, which can vary by client size, services, value-based payments, and other factors. Health plans, including self-funded plans, must pay PBMs for reducing total drug spending over a defined period and for direct services. PBMs cannot earn income tied to a drug’s net acquisition cost through markups, copayments above drug cost, spread pricing, purchasing-group revenue, manufacturer revenue, or other pricing arrangements. Insurance-carrier-linked PBMs must pass accidentally collected prohibited income to plan members.

Pharmacies get new drug payment standards

Beginning January 1, 2027, pharmacy benefit managers must pay pharmacies using a national drug-cost benchmark. Payment equals the National Average Drug Acquisition Cost for drug ingredients, plus a reasonable and adequate dispensing fee. If that benchmark is unavailable when the drug is dispensed, payment must be at least the Wholesale Acquisition Cost. The rule covers independent pharmacies and manager-affiliated retail, mail-order, and specialty pharmacies. It does not set what consumers pay.

Sponsors & Cosponsors

Sponsors

  • Byron Pelton

    Republican • Senate

  • Dusty Johnson

    Republican • House

  • Dylan Roberts

    Democratic • Senate

  • Kyle Brown

    Democratic • House

Cosponsors

  • Andrew Boesenecker

    Democratic • House

  • Amy Paschal

    Democratic • House

  • Alex Valdez

    Democratic • House

  • Emily Sirota

    Democratic • House

  • Elizabeth Velasco

    Democratic • House

  • Jennifer Bacon

    Democratic • House

  • Junie Joseph

    Democratic • House

  • Julie McCluskie

    Democratic • House

  • Karen McCormick

    Democratic • House

  • Katie Stewart

    Democratic • House

  • Lesley Smith

    Democratic • House

  • Monica Duran

    Democratic • House

  • Mandy Lindsay

    Democratic • House

  • Regina English

    Democratic • House

  • Rep. S. Bird

    Affiliation unavailable

  • Sheila Lieder

    Democratic • House

  • Steven Woodrow

    Democratic • House

  • Yara Zokaie

    Democratic • House

  • Cathy Kipp

    Democratic • Senate

  • Iman Jodeh

    Democratic • Senate

  • Judy Amabile

    Democratic • Senate

  • Jeff Bridges

    Democratic • Senate

  • Katie Wallace

    Democratic • Senate

  • Mike Weissman

    Democratic • Senate

  • Nick Hinrichsen

    Democratic • Senate

  • Tony Exum

    Democratic • Senate

Roll Call Votes

All Roll Calls

Yes: 214 • No: 52

House vote • 5/7/2025

Senate amendments: Repass

Yes: 49 • No: 16

House vote • 5/7/2025

Senate amendments: Concur

Yes: 56 • No: 8

Senate vote • 5/6/2025

Third reading: Bill

Yes: 29 • No: 6

Senate vote • 4/30/2025

Refer House Bill 25-1094 to the Committee of the Whole.

Yes: 7 • No: 0

Senate vote • 4/24/2025

Refer House Bill 25-1094, as amended, to the Committee on Appropriations.

Yes: 7 • No: 2

House vote • 3/17/2025

Third reading: Bill

Yes: 48 • No: 15

House vote • 3/7/2025

Refer House Bill 25-1094 to the Committee of the Whole.

Yes: 8 • No: 2

House vote • 2/19/2025

Refer House Bill 25-1094, as amended, to the Committee on Appropriations.

Yes: 10 • No: 3

Actions Timeline

  1. Governor Signed

    5/30/2025House

  2. Signed by the Speaker of the House

    5/13/2025House

  3. Signed by the President of the Senate

    5/13/2025Senate

  4. Sent to the Governor

    5/13/2025House

  5. House Considered Senate Amendments - Result was to Concur - Repass

    5/7/2025House

  6. Senate Third Reading Passed - No Amendments

    5/6/2025Senate

  7. House Considered Senate Amendments - Result was to Laid Over Daily

    5/6/2025House

  8. Senate Third Reading Laid Over Daily - No Amendments

    5/5/2025Senate

  9. Senate Second Reading Special Order - Passed with Amendments - Committee

    5/2/2025Senate

  10. Senate Committee on Appropriations Refer Unamended to Senate Committee of the Whole

    4/30/2025Senate

  11. Senate Committee on Health & Human Services Refer Amended to Appropriations

    4/24/2025Senate

  12. Introduced In Senate - Assigned to Health & Human Services

    3/20/2025Senate

  13. House Third Reading Passed - No Amendments

    3/17/2025House

  14. House Second Reading Special Order - Passed with Amendments - Committee, Floor

    3/14/2025House

  15. House Second Reading Laid Over Daily - No Amendments

    3/11/2025House

  16. House Committee on Appropriations Refer Unamended to House Committee of the Whole

    3/7/2025House

  17. House Committee on Health & Human Services Refer Amended to Appropriations

    2/19/2025House

  18. Introduced In House - Assigned to Health & Human Services

    1/27/2025House

Bill Text

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