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June 20, 2024

Kentucky enacts PBM law

Kentucky is the latest state to pass legislation regulating pharmacy benefit managers (PBMs) with Senate Bill 188 (SB 188), which was signed into law by the Governor of Kentucky on April 5, 2024. SB 188 applies to PBM contracts issued, renewed, extended, or amended on or after January 1, 2025.

SB 188 will affect employers offering prescription drug benefits to Kentucky residents, and it is intended to level the playing field between commercial PBMs and independent pharmacists. Although the bulk of the law is aimed at protecting the right of patients to choose their own pharmacies and pharmacists, SB 188 will have some impact on group health plans providing prescription drug coverage to participants in Kentucky.

This Alert summarizes SB 188, with a focus on those provisions most likely to affect employer-sponsored group health plans. The Alert also addresses the possibility of ERISA preemption for self-insured ERISA plans from portions of the law.