Impacted: Helath plan clients (commercial, Medicare and Medicaid)

What you need to know
The Arkansas Pharmacy Benefit Manager Licensure Act provides for the regulation of pharmacy benefit managers (PBMs) operating in the State of Arkansas. In 2024, the Arkansas Insurance Department (AID), which is responsible for administering this law, released regulations and guidance pertaining to pharmacy reimbursement practices and data reporting to AID. 

Arkansas Rule 128 and the Bulletin #18-2024 require that “health benefit plans” and “healthcare payors” submit various data to AID. Under Arkansas law, those terms include essentially all types of prescription drug plans, including those offered by an insurer, a health maintenance organization (HMO), or any entity providing coverage on a self-funded basis (including governmental plans). They also expressly include any “group plan, policy, or contract for healthcare services issued outside [Arkansas] that provides benefits to residents of [Arkansas].” 

Reporting requirements
The data requested by AID is limited to claims processed by Arkansas-licensed pharmacies. According to AID, the reporting requirements are applicable to “all client types", which includes both insured and self-funded business.

AID has released two reporting templates, one covering plans with 5,000 or more Arkansas residents, and the other covering plans with fewer than 5,000 Arkansas residents.

Prime recognizes that the Arkansas law and AID’s requirements raise significant questions, including the extent to which a state may regulate or compel reporting from or relating to:

1. Insured business written in other states
2. ERISA-governed plans
3. Self-funded non-ERISA plans from other states (e.g., a municipality in California)

Interestingly, AID’s stated goal of assessing whether the reimbursement to pharmacies is “fair and reasonable” is to determine whether the plan has provided an “adequate pharmacy benefits network.”  We believe that, for these types of business, the plan and not state regulators determine the adequacy of its provider networks. For example, although Arkansas is free to set the terms of reimbursement, an ERISA-governed plan itself is free to decide how many and which types of pharmacies are in its provider network. 

Prime's approach
Despite these issues, our understanding is that AID believes it is entitled to collect this information and expects data with respect to “all client types.” Accordingly, we propose to include all client types in our reporting for your plans. ​Bulletin #18-2024 indicates that PBMs may file the reporting on behalf of its plan customers. The data reporting templates provided by AID do not provide the clarity that we hoped to receive, but do indicate that reports should be filed “for each client.”  We believe a reasonable view is that Prime may submit at the client (e.g., Blue Cross Blue Shield (BCBS)) level in aggregate form. 

Prime is prepared to submit reports at the “client” (BCBS) level. Additionally:

• We propose to list each self-funded group, where our data shows that the group has at least one Arkansas resident. 
• We will include a listing of self-funded groups that will include group name, state of the plan and the number of Arkansas residents.
• We propose to provide information about insured business by plan type (as allowed under the Bulletin). We plan to break out “fully insured” from health insurance marketplace "(HIM)/Exchange” business on separate lines.
• The insured group listing will include the designation of fully insured or (HIM)/Exchange, the state of the business, and the number of Arkansas residents within each of those.

Next steps
We believe our approach is a reasonable one that should satisfy AID at this time. You do not need to take any action at this time if you generally agree with our approach. AID granted Prime an extension to file by March 3, 2025.

If your plan does not want Prime to provide reporting to AID, please contact Client Communications@PrimeTherapeutics.com by February 28, 2025. 

We understand that AID has generally been granting extensions to file. If you have self-funded plans that wish to file directly with AID, we urge them to contact AID to request an extension of time to file the report by emailing insurance.legal@arkansas.gov. Please contact us for support regarding data needs.