SB50: Bill Text

Analysis by the Legislative Reference Bureau

Elimination of cost sharing for prescription drugs under the Medical Assistance program

Under current law, certain persons who receive health services under the Medical Assistance program, also known in this state as BadgerCare, are required to contribute a cost-sharing payment to the cost of certain health services. This bill eliminates all cost-sharing payments for prescription drugs under the Medical Assistance program. The Medical Assistance program is a joint state and federal program that provides health services to individuals who have limited financial resources.

Cost-sharing cap on insulin

The bill prohibits every health insurance policy and governmental self-insured health plan that covers insulin and imposes cost sharing on prescription drugs from imposing cost sharing on insulin in an amount that exceeds $35 for a one-month supply. Current law requires every health insurance policy that provides coverage of expenses incurred for treatment of diabetes to provide coverage for specified expenses and items, including insulin. The required coverage under current law for certain diabetes treatments other than insulin infusion pumps is subject to the same exclusions, limitations, deductibles, and coinsurance provisions of the policy as other covered expenses. The bill’s cost-sharing limitation on insulin supersedes the specification that the exclusions, limitations, deductibles, and coinsurance are the same as for other coverage.

Fiduciary and disclosure requirements for pharmacy benefit managers

The bill imposes fiduciary and disclosure requirements on pharmacy benefit managers. Pharmacy benefit managers contract with health plans that provide prescription drug benefits to administer those benefits for the plans. They also have contracts with pharmacies and pay the pharmacies for providing drugs to the plan beneficiaries.

The bill provides that a pharmacy benefit manager owes a fiduciary duty to a health plan sponsor. The bill also requires that a pharmacy benefit manager annually disclose all of the following information to the plan sponsor:

1. The indirect profit received by the pharmacy benefit manager from owning a pharmacy or service provider.

2. Any payments made to a consultant or broker who works on behalf of the plan sponsor.

3. From the amounts received from drug manufacturers, the amounts retained by the pharmacy benefit manager that are related to the plan sponsor’s claims or bona fide service fees.

4. The amounts received from network pharmacies and the amount retained by the pharmacy benefit manager.

Reimbursements for certain 340B program entities

The bill prohibits any person from reimbursing certain entities that participate in the federal drug pricing program, known as the 340B program, for a drug subject to an agreement under the program at a rate lower than that paid for the same drug to pharmacies that have a similar prescription volume. The bill also prohibits a person from imposing any fee, charge back, or other adjustment on the basis of the entity’s participation in the 340B program. The entities covered by the prohibitions under the bill are federally qualified health centers, critical access hospitals, and grantees under the federal Ryan White HIV/AIDS program, as well as these entities’ pharmacies and any pharmacy with which any of the entities have contracted to dispense drugs through the 340B program.

Drug repository program

Under current law, the Department of Health Services must maintain a drug repository program under which any person may donate certain drugs or supplies to be dispensed to and used by eligible individuals, prioritizing uninsured and indigent individuals. The bill allows DHS to partner with out-of-state drug repository programs. The bill also allows out-of-state persons to donate to the drug repository program in Wisconsin and persons in Wisconsin to donate to participating drug repository programs in other states. Further, the bill directs DHS to study and implement a centralized, physical drug repository program.

Value-based diabetes medication pilot project

The bill directs the Office of the Commissioner of Insurance to develop a pilot project under which a pharmacy benefit manager and pharmaceutical manufacturer are directed to create a value-based, sole-source arrangement to reduce the costs of prescription diabetes medication. The bill allows OCI to promulgate rules to implement the pilot project.

Pharmacist continuing education credits for volunteering at free and charitable clinics

Under current law, a licensed pharmacist must renew his or her license every two years. An applicant for renewal of a pharmacist license must submit proof that he or she has completed 30 hours of continuing education within the two-year period immediately preceding the date of his or her application. The bill allows pharmacists to meet up to 10 hours of the continuing education requirement for each two-year period by volunteering at a free and charitable clinic approved by the Pharmacy Examining Board.

Prescription drug importation program

The bill requires the commissioner of insurance, in consultation with persons interested in the sale and pricing of prescription drugs and federal officials and agencies, to design and implement a prescription drug importation program for the benefit of and that generates savings for Wisconsin residents. The bill establishes requirements for the program, including all of the following:

1. The commissioner must designate a state agency to become a licensed wholesale distributor or contract with a licensed wholesale distributor and to seek federal certification and approval to import prescription drugs.

2. The program must comply with certain federal regulations and import from Canadian suppliers only prescription drugs that are not brand-name drugs, have fewer than four competitor drugs in this country, and for which importation creates substantial savings.

3. The commissioner must ensure that prescription drugs imported under the program are not distributed, dispensed, or sold outside of Wisconsin.

4. The program must have an audit procedure to ensure the program complies with certain requirements specified in the bill.

Before submitting the proposed program to the federal government for certification, the commissioner must submit the proposed program to the Joint Committee on Finance for its approval.

Pharmacy benefits tool grants

The bill directs OCI to award grants in an amount of up to $500,000 in each fiscal year to health care providers to develop and implement a patient pharmacy benefits tool that would allow prescribers to disclose the cost of prescription drugs for patients. The tool must be usable by physicians and other prescribers to determine the cost of prescription drugs for their patients. Any health care provider that receives a grant to develop and implement a patient pharmacy benefits tool is required to contribute matching funds equal to at least 50 percent of the total grant awarded.

Prescription drug purchasing entity study

The bill requires OCI to conduct a study on the viability of creating or implementing a state prescription drug purchasing entity.

Licensure of pharmacy services administrative organizations

The bill requires that a pharmacy services administrative organization (PSAO) be licensed by OCI. Under the bill, a PSAO is an entity operating in Wisconsin that does all of the following:

1. Contracts with an independent pharmacy to conduct business on the pharmacy’s behalf with a third-party payer.

2. Provides at least one administrative service to an independent pharmacy and negotiates and enters into a contract with a third-party payer or pharmacy benefit manager on the pharmacy’s behalf.

The bill defines “independent pharmacy” to mean a licensed pharmacy operating in Wisconsin that is under common ownership with no more than two other pharmacies. “Administrative service” is defined to mean assisting with claims or audits, providing centralized payment, performing certification in a specialized care program, providing compliance support, setting flat fees for generic drugs, assisting with store layout, managing inventory, providing marketing support, providing management and analysis of payment and drug dispensing data, or providing resources for retail cash cards. The bill defines “third-party payer” to mean an entity operating in Wisconsin that pays or insures health, medical, or prescription drug expenses on behalf of beneficiaries. The bill uses the current law definition of “pharmacy benefit manager,” which is an entity doing business in Wisconsin that contracts to administer or manage prescription drug benefits on behalf of an insurer or other entity that provides prescription drug benefits to Wisconsin residents.

To obtain the license required by the bill, a person must apply to OCI and provide the contact information for the applicant and a contact person, evidence of financial responsibility of at least $1,000,000, and any other information required by the commissioner by rule. Under the bill, the license fee is set by the commissioner, and the term of a license is two years.

The bill also requires that a PSAO disclose to OCI the extent of any ownership or control by an entity that provides pharmacy services; provides prescription drug or device services; or manufactures, sells, or distributes prescription drugs, biologicals, or medical devices. The PSAO must notify OCI within five days of any material change in its ownership or control related to such an entity.

Licensure of pharmaceutical representatives

The bill requires a pharmaceutical representative to be licensed by OCI and to display the pharmaceutical representative’s license during each visit with a health care professional. The bill defines “pharmaceutical representative” to mean an individual who markets or promotes pharmaceuticals to health care professionals on behalf of a pharmaceutical manufacturer for compensation.

The term of a license issued under the bill is one year, and the license is renewable. The application to obtain or renew a license must include the applicant’s contact information, a description of the type of work in which the applicant will engage, the license fee, an attestation that professional education requirements are met, proof that any penalties and other fees are paid, and any other information required by OCI by rule. Under the bill, the license fee is set by the commissioner. The bill requires the pharmaceutical representative to report, within four business days, any change to the information provided on the application or any material change to the pharmaceutical representative’s business operations or other information required to be reported under the bill.

The bill requires that a pharmaceutical representative complete a professional education course prior to becoming licensed and to annually complete at least five hours of continuing professional education courses. The coursework must include, at a minimum, training in ethical standards, whistleblower protections, and the laws and rules applicable to pharmaceutical marketing. The bill directs the commissioner to regularly publish a list of courses that fulfill the education requirements. Under the bill, a course provider must disclose any conflict of interest to the commissioner, and the courses may not be provided by the employer of a pharmaceutical representative or be funded by the pharmaceutical industry or a third party funded by the industry.

The bill requires that, no later than June 1 of each year, a pharmaceutical representative report to OCI the pharmaceutical representative’s total number of contacts with health care professionals in Wisconsin, the specialties of those health care professionals, the location and duration of each contact, the pharmaceuticals discussed, and the value of any item provided to a health care professional. The bill directs the commissioner to publish the information on OCI’s website without identifying individual health care professionals.

The bill requires that a pharmaceutical representative, during each contact with a health care professional, disclose the wholesale acquisition cost of any pharmaceuticals discussed and the names of at least three generic prescription drugs from the same therapeutic class.

The bill directs the commissioner to promulgate ethical standards for pharmaceutical representatives. Additionally, the bill prohibits a pharmaceutical representative from engaging in deceptive or misleading marketing of a pharmaceutical product; using a title or designation that could reasonably lead a licensed health care professional, or an employee or representative of such a professional, to believe that the pharmaceutical representative is licensed to practice in a health occupation unless the pharmaceutical representative holds a license to practice in that health occupation; or attending a patient examination without the patient’s consent.

An individual who violates any of the requirements under the bill is subject to a forfeiture, and the individual’s license may be suspended or revoked. An individual whose license is revoked must wait at least two years before applying for a new license.

Insulin safety net programs

The bill requires insulin manufacturers to establish a program under which qualifying Wisconsin residents who are in urgent need of insulin and are uninsured or have limited insurance coverage can be dispensed insulin at a pharmacy. An individual is in urgent need of insulin if the individual needs insulin in order to avoid the likelihood of suffering a significant health consequence and possesses less than a seven-day supply of insulin readily available for use. Under the program, if a qualifying individual in urgent need of insulin provides a pharmacy with a form attesting that the individual meets the program’s eligibility requirements, specified proof of residency, and a valid insulin prescription, the pharmacy must dispense a 30-day supply of insulin to the individual and may charge the individual a copayment of no more than $35. The pharmacy may submit an electronic payment claim for the insulin’s acquisition cost to the manufacturer or agree to receive a replacement of the same insulin in the amount dispensed.

The bill also requires that each insulin manufacturer establish a patient assistance program to make insulin available to any qualifying Wisconsin resident who, among other requirements, is uninsured or has limited insurance coverage and whose family income does not exceed 400 percent of the federal poverty line. Under the bill, an individual must apply to participate in a manufacturer’s program. If the manufacturer determines that the individual meets the program’s eligibility requirements, the manufacturer must issue the individual a statement of eligibility, which is valid for 12 months and may be renewed. Under the bill, if an individual with a statement of eligibility and valid insulin prescription requests insulin from a pharmacy, the pharmacy must submit an order to the manufacturer, who must then provide a 90-day supply of insulin at no charge to the individual or pharmacy. The pharmacy may charge the individual a copayment of no more than $50. Under the bill, a manufacturer is not required to issue a statement of eligibility if the individual has prescription drug coverage through an individual or group health plan and the manufacturer determines that the individual’s insulin needs are better addressed through the manufacturer’s copayment assistance program. In such case, the manufacturer must provide the individual with necessary drug coupons to submit to a pharmacy, and the individual may not be required to pay more than a $50 copayment for a 90-day supply of insulin.

Under the bill, if the manufacturer determines that an individual is not eligible for the patient assistance program, the individual may file an appeal with OCI. The bill directs OCI to establish procedures for deciding appeals. Under the bill, OCI must issue a decision within 10 days, and that decision is final.

The bill requires that insulin manufacturers annually report to OCI certain information, including the number of individuals served and the cost of insulin dispensed under the programs and that OCI annually report to the governor and the legislature on the programs. The bill also directs OCI to conduct public outreach and develop an information sheet about the programs, conduct satisfaction surveys of individuals and pharmacies that participate in the programs, and report to the governor and the legislature on the surveys by July 1, 2028. Additionally, the bill requires that OCI develop a training program for health care navigators to assist individuals in accessing appropriate long-term insulin options and maintain a list of trained navigators.

The bill provides that a manufacturer that fails to comply with the bill’s provisions may be assessed a forfeiture of up to $200,000 per month of noncompliance, which increases to $400,000 per month if the manufacturer continues to be in noncompliance after six months and to $600,000 per month if the manufacturer continues to be in noncompliance after one year. The bill’s requirements do not apply to manufacturers with annual insulin sales revenue in Wisconsin of no more than $2,000,000 or to insulin that costs less than a specified dollar amount.

Prescription Drug Affordability Review Board

The bill creates a Prescription Drug Affordability Review Board, whose purpose is to protect Wisconsin residents and other stakeholders from the high costs of prescription drugs. The board consists of the commissioner of insurance and the following members, all of whom are appointed by the governor for four-year terms:

1. Two members who represent the pharmaceutical drug industry, at least one of whom is a licensed pharmacist.

2. Two members who represent the health insurance industry.

3. Two members who represent the health care industry, at least one of whom is a licensed practitioner.

4. Two members who represent the interests of the public.

The bill requires the board to meet in open session at least four times per year to review prescription drug pricing information. The board must provide at least two weeks’ public notice of each meeting, make the meeting’s materials publicly available at least one week prior to the meeting, and provide the opportunity for public comment. The bill imposes conflict of interest requirements for the board relating to recusal and public disclosure of certain conflicts. The bill directs the board to access and assess drug pricing information, to the extent practicable, by accessing and assessing information from other states, by assessing spending for the drug in Wisconsin, and by accessing other available pricing information.

Under the bill, the board must conduct drug cost affordability reviews. The board must identify prescription drugs whose launch wholesale acquisition cost exceeds specified thresholds, prescription drugs whose increase in wholesale acquisition cost exceeds specified thresholds, and other prescription drugs that may create affordability challenges for the health care system in Wisconsin. For each identified prescription drug, the board must determine whether to conduct an affordability review by seeking stakeholder input and considering the average patient cost share for the drug. During an affordability review, the board must determine whether use of the prescription drug that is fully consistent with the labeling approved by the federal Food and Drug Administration or standard medical practice has led or will lead to an affordability challenge for the health care system in Wisconsin. In making this determination, the bill requires the board to consider a variety of factors, which include the following:

1. The drug’s wholesale acquisition cost.

2. The average monetary price concession, discount, or rebate the manufacturer provides, or is expected to provide, for the drug to health plans.

3. The total amount of price concessions, discounts, and rebates the manufacturer provides to each pharmacy benefit manager for the drug.

4. The price at which therapeutic alternatives have been sold and the average monetary concession, discount, or rebate the manufacturer provides, or is expected to provide, to health plan payors and pharmacy benefit managers for therapeutic alternatives.

5. The costs to health plans based on patient access consistent with federal labeled indications and recognized standard medical practice.

6. The impact on patient access resulting from the drug’s cost relative to insurance benefit design.

7. The current or expected dollar value of drug-specific patient access programs that are supported by the manufacturer.

8. The relative financial impacts to health, medical, or social services costs that can be quantified and compared to baseline effects of existing therapeutic alternatives.

9. The average patient copay or other cost sharing for the drug.

If the board determines that a prescription drug will lead to an affordability challenge, the bill directs the board to establish an upper payment limit for that drug that applies to all purchases and payor reimbursements of the drug dispensed or administered to individuals in Wisconsin. In establishing the upper payment limit, the board must consider the cost of administering the drug, the cost of delivering it to consumers, and other relevant administrative costs. For certain drugs, the board must solicit information from the manufacturer regarding the price increase and, if the board determines that the price increase is not a result of the need for increased manufacturing capacity or other effort to improve patient access during a public health emergency, the board must establish an upper payment limit equal to the drug’s cost prior to the price increase.

Further, this bill provides $500,000 in program revenue in fiscal year 2026–27 for onetime implementation costs associated with establishing an Office of Prescription Drug Affordability in OCI. The bill provides that the Office of Prescription Drug Affordability is responsible for prescription drug affordability programming within OCI and for overseeing the operations of the Prescription Drug Affordability Review Board. Additionally, the bill authorizes and funds for fiscal year 2026–27 16.0 positions for the Office of Prescription Drug Affordability.

Finally, the bill credits to the appropriation account for OCI’s general program operations all moneys received from the regulation of pharmacy benefit managers, pharmacy benefit management brokers, pharmacy benefit management consultants, pharmacy services administrative organizations, and pharmaceutical sales representatives.

This proposal may contain a health insurance mandate requiring a social and financial impact report under s. 601.423, stats.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

SB50,1 Section 1. 15.07 (3) (bm) 7. of the statutes is created to read:

SB50,2,3 15.07 (3) (bm) 7. The prescription drug affordability review board shall meet at least 4 times each year.

SB50,2 Section 2. 15.735 of the statutes is created to read:

SB50,2,7 15.735 Same; attached board. (1) There is created a prescription drug affordability review board attached to the office of the commissioner of insurance under s. 15.03. The board shall consist of the following members:

SB50,2,8 (a) The commissioner of insurance or his or her designee.

SB50,3,3 (b) Two members appointed for 4-year terms who represent the pharmaceutical drug industry, including pharmaceutical drug manufacturers and wholesalers. At least one of the members appointed under this paragraph shall be a pharmacist licensed in this state.

SB50,3,5 (c) Two members appointed for 4-year terms who represent the health insurance industry, including insurers and pharmacy benefit managers.

SB50,3,9 (d) Two members appointed for 4-year terms who represent the health care industry, including hospitals, physicians, pharmacies, and pharmacists. At least one of the members appointed under this paragraph shall be a licensed health care practitioner.

SB50,3,11 (e) Two members appointed for 4-year terms who represent the interests of the public.

SB50,3,14 (2) A member appointed under sub. (1), except for a member appointed under sub. (1) (b), may not be an employee of, a board member of, or a consultant to a drug manufacturer or trade association for drug manufacturers.

SB50,3,19 (3) Any conflict of interest, including any financial or personal association, that has the potential to bias or has the appearance of biasing an individual’s decision in matters related to the board or the conduct of the board’s activities shall be considered and disclosed when appointing that individual to the board under sub. (1).