Credit: Bruce Stanfield/Adobe Stock
Texas could stop health insurers or other coverage issuers in the Lone Star State from requiring patients to use the carriers' own pharmacy benefit managers.
Texas state Rep. Cody Harris, R-Palestine, Texas, last week introduced a bill that could prohibit a health insurer, a health maintenance organization or any other health benefit plan issuer with a financial interest in a PBM from requiring a plan participant to use the PBM.
Recommended For You
Harris has been a leader of efforts in Texas to keep the Employee Retirement Income Security Act from preempting state regulation of PBMs when the PBMs are working with self-insured employer health plans.
Harris wrote the bill that created Texas' anti-PBM-steering law.
The law, which recently received an endorsement from Texas Attorney General Ken Paxton, prohibits health benefit plan issuers and PBMs from using cost-sharing rules or other benefit design rules to encourage patients to use pharmacies affiliated with the issuers or PBMs.
Related: Texas can regulate self-insured plans' PBMs, its attorney general rules
The U.S. Supreme Court is looking at similar rules adopted by Oklahoma.
The debate: Pharmacies and some employers argue that big PBMs are using their size to crowd out competition and negotiate deals that do more to increase the PBMs' revenue than to hold costs down for employers or patients.
The big PBMs contend that they have done a good job of holding prescription drug costs and have very high employer customer renewal rates. They say the anti-PBM attacks are coming from drug manufacturers, pharmacies and other companies that are angry about the PBMs' success at cutting prescription drug costs and reducing other prescription market players' profit margins.
Some employer groups, including the ERISA Industry Council, have argued that any new rules affecting self-insured plans should come from Congress, not state legislatures.
The future: If Texas finds a way to regulate PBM interactions with self-insured employer health plans, that could lead to a wide range of health care provider groups trying to adopt a similar strategy.
The American Optometric Association, the American Dental Association and the American Association of Orthodontists are some of the groups that have been asking the U.S. Supreme Court to make it easier for states to regulate employers' self-funded health plans.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.