Pharmacy Benefit Managers

The Minnesota Pharmacy Benefit Manager (PBM) Licensure and Regulation Act was signed into law on May 17, 2019, creating Chapter 62W in Minnesota Statute. The new law established annual licensing and transparency reporting requirements for PBMs, as well as new protections for consumers and pharmacies. 

As directed by the statute, Commerce undertook an extensive rulemaking process, which concluded in December 2021. The document is available on Commerce's PBM rulemaking page. Please note that the comprehensive set of adopted rules will be published on the Office of the Revisor of Statute’s website later in the spring.

Public transparency reports and other prescription drug information are available on the Reports & Studies section of our website.  

More information for consumers, pharmacies, and PBMs can be found below.

Minnesota Statutes Chapter 62W (effective Jan. 1, 2020) and Minnesota Administrative Rules Chapter 2737 (effective Jan. 18, 2022) form the legal basis for PBM regulation in Minnesota. Consumers and pharmacies have new rights under the law, which can be found in the following sections of Minnesota statute:

• PBMs must become licensed in Minnesota prior to performing services to Minnesota-based plan sponsors, or for plan sponsors that provide prescription coverage for Minnesota employees/residents: 62W.03
• PBMs required to submit annual transparency reports to commissioner: 62W.06
• Establishes maximum time/distance standards to ensure covered members’ access to in-network retail locations: 62W.05
• PBMs must provide a minimum number of in-network pharmacy options to fill prescriptions. A PBM cannot require/incentivize a covered member to use its own pharmacy unless certain other conditions are met (anti-steering provisions): 62W.07/2737.1200
• Establishes standards for prompt filling of “specialty” medications filled by mail order: 62W.14
• Establishes standards to allow members who take multiple medications to synchronize refills: 62W.10
• Pharmacies can appeal PBM reimbursements that are below their acquisition costs through MAC appeal process: 62W.08
• Establishes pharmacy audit standards PBMs must adhere to: 62W.09
• PBMs barred from using contracts to limit information pharmacies can share with members and/or health carriers regarding acquisition costs, availability of less costly alternative medications, and PBM reimbursements: 62W.11

If you believe a PBM is violating a provision of Chapter 62W or 2737, you may file a complaint with Commerce by following the instructions on our website.

Commerce’s ability to investigate complaints or impose penalties for alleged violations can be limited based on certain federal laws and the type of plan that provides the prescription drug benefit the PBM is managing. For example, complaints about Medicare Part D plans are handled by the federal Centers for Medicare & Medicaid Services. 

Licensing

The law requires PBMs contracting with plan sponsors doing business in Minnesota to be actively licensed. Licenses are required to be renewed each year. The law also outlines requirements for licensure and sets standards for penalties for performing PBM services without a license. More information on the initial licensing and renewal processes is available on the Insurance Licensing page of the Commerce website.

Transparency reporting

The law also established transparency reporting requirements for PBMs. By June 1 of each year, all licensed PBMs must submit some form of response to Commerce regarding their reporting status for the previous plan year. All qualifying PBMs are required to submit their prescription drug reports by the same deadline. Commerce requires PBMs to use the Aggregate, Claims Level Detail, and Public Report templates when there is applicable data to submit (more information is available in the table below). The Department will not publish any data considered to be trade secret or outside the scope of Minn. Stat. §62W.06, subd. 2. 

The two templates must also be used when reporting zero data to the Department. If a PBM has determined it does not have reporting responsibilities, each template should be completed as a “zero report,” and accompanied by a brief justification to the Department. 

Below is a list of scenarios and corresponding explanations for transparency or zero reports:

Additional information regarding PBM transparency reporting for plan year 2021 will be available on this page in Spring 2022.