OhioHB 229136th General Assembly (2025-2026)HouseWALLET

Establish licensing process, contract requirements for PBMs

Sponsored By: Kellie Deeter (Republican)

Signed by Governor

CommerceInsuranceHealth and Human ServicesHealth CareOccupational Licensing and RegulationState and Local GovernmentState GovernmentTaxation

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Bill Overview

Analyzed Economic Effects

12 provisions identified: 4 benefits, 4 costs, 4 mixed.

Lower prescription charges and protected delivery

Plans, pharmacy benefit managers, and administrators cannot require prescription cost-sharing above the lower of two amounts. Those amounts are the price without coverage and the net payment to the pharmacy. They also cannot stop pharmacies from offering mailing or delivery as an extra service; pharmacies need not offer it. Ohio’s Department of Insurance must provide an online form for consumers to report violations of these rules.

Drug plans see billing price differences

Pharmacy benefit managers must tell plan sponsors whether sponsor bills and pharmacy payments use the same maximum allowable cost list. When managers use multiple lists, they must disclose the total differences between pharmacy payments and sponsor charges. Disclosures occur within 10 days after contract signing or quarterly. These disclosure rules exclude plans governed by ERISA, the federal employee-benefits law, or Medicare Part D.

Faster pricing updates and pharmacy appeals

Pharmacy contracts must provide current maximum allowable cost pricing sources within 10 days of a request. Prices must update at least every seven days, with new data used for payments within one business day. Pharmacies get secure, searchable electronic review, electronic appeals, a contact phone number, and reasons for denials. Pharmacies have 21 days to appeal; managers have 21 days to resolve appeals. Successful appeals require payment adjustments within one day, back to the appeal date, including adjustments for similarly situated pharmacies. Listed drugs must meet rating standards, be generally available from national or regional wholesalers, and not be obsolete. Insurers that meet Ohio’s pharmacy benefit manager definition must also follow these rules and face the law’s referenced penalties.

More predictable claim payments for pharmacies

Health plans, pharmacy benefit managers, and administrators generally cannot change pharmacy claim payments after processing. Changes remain allowed after an audit under Ohio’s pharmacy audit laws or a technical billing error. They can charge claim-related fees only when the amount can be determined as the claim is processed.

Drug benefit managers need Ohio licenses

Beginning July 1, 2027, pharmacy benefit managers need Ohio licenses to solicit covered Ohio-based plans or sponsors. Service requirements apply to covered agreements made, changed, or renewed on or after that date; expired licenses bar activity. Individual applicants must be at least 18, meet criminal-history rules, consent to background checks, and show citizenship or work authorization. Businesses must meet Ohio-presence rules, disclose owners and officers, and name a person responsible for compliance. Out-of-state applicants need a qualifying home-state license and reciprocal licensing treatment. Licenses generally expire June 30; renewal applications are due within the preceding 90 days and before expiration. Licensed managers must maintain any insurance or bond required by ERISA. Federal law limits licensing rules for employer self-insurance programs and fully insured plans only where it prevents state regulation. Licensed managers are excluded from the separate “administrator” definition for agreements made, changed, or renewed starting July 1, 2027.

Drug managers face fines and discipline

After notice and a hearing, Ohio can impose civil penalties up to $15,000 per violation and administrative costs. Courts can also impose up to $15,000 per violation and other relief. State remedies include license denial, nonrenewal, suspension, permanent revocation, business limits, and correction orders. Knowing violations of the cost-sharing rules can bring suspension for up to two years, revocation, or nonrenewal. Surrendering a license for cause bars seeking an Ohio insurance-law license for at least five years. Ohio can order activity stopped for substantial harm or to protect the public, insurers, and sponsors. Separate fine authority covers pricing-rule violations and fraudulent, illegal, or dishonest management activity, after investigation and a hearing. Knowingly violating the licensing prohibition is a fourth-degree misdemeanor.

Drug managers face stricter conduct rules

Licensed pharmacy benefit managers must report covered government actions within 30 days after final disposition, with related documents. They must report criminal prosecutions within 30 days after the initial court appearance and provide a certified charging document. Final criminal-case documents are due within 30 days after the case ends. These matters must occur while licensed; misdemeanor traffic offenses are excluded. Beginning July 1, 2027, managers and representatives cannot cause or knowingly allow false or misleading ads, offers, or solicitations. Ohio’s insurance superintendent must apply existing child-support enforcement procedures to affected licenses after receiving the specified child-support notice.

New fees for drug benefit managers

Pharmacy benefit managers pay a nonrefundable $2,000 fee with each Ohio license application. Annual renewal costs $3,000, due before the license expires. Reinstating an expired license costs $4,500, or 1.5 times the renewal fee. The fees go to the Department of Insurance operating fund, not directly from households.

Drug manager oversight records stay confidential

Information Ohio’s insurance department obtains under the pharmacy benefit manager chapter is proprietary, confidential, and not a public record. Investigation records stay confidential until notice and an opportunity for a hearing are provided. If no administrative action follows, those investigation records stay confidential for three years after the file closes.

Drug managers track money and refunds

Beginning July 1, 2027, managers must keep required transaction records and cash receipt registers during services and for 10 years afterward. Annual reports of premiums or contributions, administration fees, and claim payments are due within 90 days after the plan’s fiscal year. Returned premiums must be paid or credited within 30 days of receipt; credits apply to the next bill. Monthly account reconciliations are required when requested and provided for in the service agreement. Ohio can examine rebate and pharmacist-payment records; managers pay examination costs and must fix noticed violations within 60 days. For agreements made, changed, or renewed starting July 1, 2027, managers must also provide requested transaction records to regulators. They must protect health information under applicable privacy laws.

Drug plans gain financial disclosure protections

For agreements made, changed, or renewed starting July 1, 2027, managers must account to sponsors at least annually. This covers discounts, rebates, inflation payments, credits, fees, reimbursements, and other listed benefits, plus access to financial and drug-use information. Beginning July 1, 2027, sponsor funds can be used only for purposes stated in writing. Managers must disclose how they collect and hold funds and any insurer ownership relationship of 5% or more. Premiums must be sent within the policy period or an agreed written deadline. The fund-handling restrictions do not apply where they conflict with an agreement outside the chapter.

Written drug plan contracts reveal conflicts

For agreements made, changed, or renewed starting July 1, 2027, pharmacy benefit managers must use written plan-sponsor contracts. Contracts must state their length, services, payment method and rates, and renewal and ending terms. Managers must keep contracts during their term and for five years afterward. Plan sponsors receive written disclosures of related third-party deals, including group purchasing arrangements, and direct or indirect conflicts of interest.

Sponsors & Cosponsors

Sponsor

Kellie Deeter
Republican • House

Cosponsors

Adam C. Bird
Republican • House
Adam Mathews
Republican • House
Andrea White
Republican • House
Angela N. King
Republican • House
Bernard Willis
Republican • House
Beth Liston
Democratic • Senate
Bill Reineke
Republican • Senate
Brian Lampton
Republican • House
C. Allison Russo
Democratic • House
Casey Weinstein
Democratic • Senate
Catherine D. Ingram
Democratic • Senate
Cecil Thomas
Democratic • House
Chris Glassburn
Democratic • House
Christine Cockley
Democratic • House
Crystal Lett
Democratic • House
Dani Isaacsohn
Democratic • House
Darnell T. Brewer
Democratic • House
David Thomas
Republican • House
Derrick Hall
Democratic • House
Dontavius L. Jarrells
Democratic • House
Erika White
Democratic • House
Gary Click
Republican • House
Gayle Manning
Republican • House
George F. Lang
Republican • Senate
Heidi Workman
Republican • House
Ismail Mohamed
Democratic • House
Jack K. Daniels
Republican • House
James M. Hoops
Republican • House
Jane M. Timken
Republican • Senate
Jerry C. Cirino
Republican • Senate
Jodi Salvo
Republican • House
Joseph A. Miller, III
Democratic • House
Josh Williams
Republican • House
Juanita O. Brent
Democratic • House
Karen Brownlee
Democratic • House
Kent Smith
Democratic • Senate
Kevin Ritter
Republican • House
Kristina D. Roegner
Republican • Senate
Kyle Koehler
Republican • Senate
Marilyn John
Republican • House
Mark Johnson
Republican • House
Mark Romanchuk
Republican • Senate
Mark Sigrist
Democratic • House
Melanie Miller
Republican • House
Meredith R. Lawson-Rowe
Democratic • House
Michael D. Dovilla
Republican • House
Michele Grim
Democratic • House
Michele Reynolds
Republican • Senate
Munira Abdullahi
Democratic • House
Nathan H. Manning
Republican • Senate
Nick Santucci
Republican • House
Nickie J. Antonio
Democratic • Senate
Paula Hicks-Hudson
Democratic • Senate
Phil Plummer
Republican • House
Rachel B. Baker
Democratic • House
Riordan T. McClain
Republican • House
Sandra O'Brien
Republican • Senate
Sean P. Brennan
Democratic • House
Shane Wilkin
Republican • Senate
Sharon A. Ray
Republican • House
Stephen A. Huffman
Republican • Senate
Steve Wilson
Republican • Senate
Terrence Upchurch
Democratic • House
Terry Johnson
Republican • Senate
Tex Fischer
Republican • House
Theresa Gavarone
Republican • Senate
Thomas F. Patton
Republican • Senate
Tim Schaffer
Republican • Senate
Tom Young
Republican • House
Ty D. Mathews
Republican • House
Veronica R. Sims
Democratic • House
William P. DeMora
Democratic • Senate
Willis E. Blackshear, Jr.
Democratic • Senate

Roll Call Votes

All Roll Calls

Yes: 244 • No: 0

House vote • 3/18/2026

Concurred in Senate amendments

Yes: 96 • No: 0

Senate vote • 3/4/2026

Passed

Yes: 31 • No: 0

Senate vote • 3/4/2026

Financial Institutions, Insurance and Technology: Reported

Yes: 8 • No: 0

House vote • 10/8/2025

General Government: Reported

Yes: 12 • No: 0