The Alabama House of Representatives on Tuesday passed SB252, legislation intended to benefit independent pharmacies by increasing transparency and limiting the power of pharmacy benefit managers (PBMs).
The bill, which passed 102-0, was sponsored by State Rep. Phillip Rigsby (R-Huntsville), a pharmacist who guided the legislation through the House. It was previously passed by the Senate on March 20.
“This bill is important for small businesses in Alabama and for patients to maintain their access to those healthcare providers that are pharmacies in their community,” Rigsby said on the floor.
“We’ve seen pharmacies close across the state, especially in rural areas. This won’t fix everything, but it will help stop some of the bleeding,” said State Rep. Mark Gidley (R-Hokes Bluff) during floor debate.
SB252 imposes a series of reforms on PBMs, the third-party intermediaries that manage prescription drug benefits for insurers. The bill prohibits PBMs from reimbursing independent pharmacies below Alabama Medicaid’s reimbursement rate, bars “steering” practices that favor PBM-affiliated pharmacies over local ones, and prohibits retroactive fees, spread pricing, and certain audit penalties.
It also ensures independent pharmacies receive equitable treatment in reimbursement and network participation. Additionally, the bill requires 100% of manufacturer rebates to be passed on to the health plan or used to offset patient costs — unless negotiated otherwise.
An amendment adopted on the floor allows private businesses to negotiate how they receive those rebates, either directly or applied to administrative fees.
“This bill doesn’t negatively impact pharmacists,” Rep. Joe Lovvorn (R-Auburn) explained. “It just gives flexibility for businesses to negotiate how rebates are treated in their PBM contracts.
The House adopted a committee substitute that removed a private right of action provision, which had previously allowed pharmacies and patients to sue PBMs for violations. It also removed the 2027 sunset clause on the reimbursement protections, making those provisions permanent.
SB252 was the product of extensive negotiations between lawmakers, pharmacy associations, and major stakeholders like Blue Cross Blue Shield of Alabama.
“This is a lifeblood issue to make sure they’re able to offer that service to our people, especially in the rural areas,” said Gidley. “I urge our members to support this bill so that we can maintain that tremendous service that our local pharmacies provide.”
The bill now heads to Governor Kay Ivey’s desk to potentially become law. If signed, reimbursement provisions will take effect October 1, 2025.
Today is day 19 of the 2025 legislative session.
Grace Heim is a state and political reporter for Yellowhammer News. You can follow her on X @graceeheim or email her at grace@yellowhammernews.com.
