Bill Text: NJ S464 | 2026-2027 | Regular Session | Introduced
Bill Title: Establishes audit and payment requirements for pharmacy benefit managers.
Sponsorship: Partisan Bill (Democrat 1)
Status: (Introduced) 2026-01-13 - Introduced in the Senate, Referred to Senate Commerce Committee [S464 Detail]
Download: New_Jersey-2026-S464-Introduced.html
STATE OF NEW JERSEY
222nd LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION
Sponsored by:
Senator BRIAN P. STACK
District 33 (Hudson)
SYNOPSIS
Establishes audit and payment requirements for pharmacy benefit managers.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
An Act concerning the transparency of pharmacy benefit managers and amending P.L.2015, c.179 and P.L.2023, c.107.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 2 of P.L.2015, c.179 (C.17B:27F-2) is amended to read as follows:
2. Upon execution or renewal of each contract, or at such a time when there is any material change in the term of the contract, a pharmacy benefits manager shall, with respect to contracts between a pharmacy benefits manager and a pharmacy services administrative organization, or between a pharmacy benefits manager and a contracted pharmacy:
a. (1) include in the contract the sources utilized to determine multiple source generic drug pricing, brand drug pricing, and the wholesaler in the State of New Jersey where pharmacies may acquire the product, including, but not limited to, the brand effective rate, generic effective rate, dispensing fee effective rate, maximum allowable cost or any other pricing formula for pharmacy reimbursement;
(2) update that pricing information every seven calendar days; and
(3) establish a reasonable process by which contracted pharmacies have a method to access relevant maximum allowable cost pricing lists, brand effective rate, generic effective rate, and dispensing fee effective rate, or any other pricing formulas for pharmacy reimbursement.
b. Additionally, a pharmacy benefits manager shall:
(1) maintain a procedure to eliminate drugs from the list of drugs subject to multiple source generic drug pricing and brand drug pricing, or modify maximum allowable cost rates, brand effective rate, generic effective rate, dispensing fee effective rate or any other applicable pricing formula in a timely fashion and make that procedure easily accessible to the pharmacy services administrative organizations or the pharmacies that they are contractually obligated with to provide that information according to the requirements of this section; [and]
(2) provide an internal appeal mechanism to resolve any dispute raised by a carrier or pharmacy, regardless of whether the carrier or pharmacy benefits manager has a contract to challenge maximum allowable costs for a specified drug. Any dispute regarding the determination of an internal appeal conducted pursuant to this subsection may be referred to arbitration. The Commissioner of Banking and Insurance shall contract with a nationally recognized, independent organization that specializes in arbitration to conduct the arbitration proceedings; and
(3) ensure that within 14 calendar days of receiving a pharmacy claim:
(a) a claim is paid or reimbursed; or
(b) notice is sent to the pharmacy in writing or electronically that the claim is contested or denied.
(cf: P.L.2023, c.107, s.4)
2. Section 8 of P.L.2023, c.107 (C.17B:27F-9.1) is amended to read as follows:
8. a. A carrier or health benefits plan, including the State Health Benefits Program, the School Employees' Health Benefits Program, the State Medicaid program, and a self-insured health benefits plan governed by the provisions of the federal "Employee Retirement Income Security Act of 1974," 29 U.S.C. s.1001 et seq., shall have the ability to access all data related to the administration and provision of prescription drug benefits administered by a pharmacy benefits manager under the health benefits plan, including, but not limited to:
(1) the names, addresses, member identification numbers, protected health information and other personal information of covered persons; and
(2) any contracts, documentation, and records, including transaction and pricing data and post point-of-sale information, related to the dispensing of prescription drugs to covered persons under the health benefits plan.
b. A sale or transaction involving the transfer of any records, information or data described in subsection a. of this section must comply with the federal Health Insurance Portability and Accountability Act of 1996, Pub. L. No. 104-191, and the federal Health Information Technology for Economic and Clinical Health Act, Pub. L. No. 111-5, and any regulations adopted pursuant to those laws.
c. A carrier or health benefits plan, including the State Health Benefits Program, the School Employees' Health Benefits Program, the State Medicaid program, or a self-insured health benefits plan may audit all transaction records related to the dispensing of prescription drugs to covered persons under a health benefits plan. A carrier or health benefits plan, including the State Health Benefits Program, the School Employees' Health Benefits Program, the State Medicaid program, or a self-insured health benefits plan may conduct audits at a location of its choosing and with an auditor of its choosing.
d. A carrier shall maintain all records, information and data described in subsection a. of this section and all audit records described in subsection c. of this section for a period of no less than five years.
e. (1) [Upon request] Annually, on a date and in a form as determined by the department, a carrier or pharmacy benefits manager shall provide to the department any records, contracts, documents or data held by the carrier or the carrier's pharmacy benefits manager for inspection, examination or audit purposes. The department shall keep confidential all information submitted pursuant to this section and shall protect it from public disclosure. Any records, documents, or data provided to the department pursuant to this subsection shall not be considered a government record under P.L.1963, c.73 (C.47:1A-1 et seq.) or the common law concerning access to government records.
(2) A person who is authorized to access information submitted by a pharmacy benefits manager to the department who willfully discloses such information to any person or entity who is not authorized to access the information shall be subject to a civil penalty in an amount not to exceed $500.
A civil penalty imposed under this subsection shall be collected by the commissioner pursuant to the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.).
f. A pharmacy benefits manager shall disclose in writing to a carrier or health benefits plan any activity, policy, practice, contract or arrangement of the pharmacy benefits manager that directly or indirectly presents any conflict of interest with the pharmacy benefits manager's relationship with or obligation to the carrier or plan.
(cf: P.L.2023, c.107, s.8)
3. This act shall take effect on the first day of the fourth month next, except that the Commissioner of Banking and Insurance may take any anticipatory administrative action in advance as shall be necessary for the implementation of this act. Section 1 shall apply to pharmacy claims received on or after the effective date.
STATEMENT
This bill establishes audit and payment requirements to be complied with by pharmacy benefit managers ("PBMs"). Under the bill, PBMs will be required to ensure that within 14 calendar days of receiving a pharmacy claim, (1) a claim is paid or reimbursed; or (2) notice is sent to the pharmacy in writing or electronically that the claim is contested or denied. Additionally, current law is amended to require annual audits of PBMs by the Department of Banking and Insurance.
