Illinois Acts to Curb Drug Prices, Expand Healthcare Access
Illinois Governor JB Pritzker recently signed legislation designed to control pharmaceutical costs and broaden healthcare coverage. These new laws aim to protect consumers from high drug prices while improving access to essential medical services, particularly for mental health care.
New Restrictions on Pharmacy Benefit Managers
One of the bills, House Bill 1697, known as the Prescription Drug Affordability Act, will regulate pharmacy benefit managers (PBMs). PBMs negotiate drug prices between insurance plans and pharmaceutical companies, shaping drug formularies.
Critics have long accused PBMs of practices that benefit themselves at the expense of patients and smaller pharmacies. The new legislation seeks to curb these practices.
Specifically, PBMs will no longer be allowed to direct patients toward specific large pharmacies in which they have a financial interest. They are also prohibited from “spread pricing,” charging health plans more for drugs than what the PBM pays the pharmacy.
The bill also establishes a $25 million annual grant program to support independent pharmacies, funded by a tax on PBMs in Illinois. David Bagot, an independent pharmacist and president of the Illinois Pharmacists Association, praised the bill.
“This bill represents the most comprehensive reform of pharmacy benefit managers we have seen in Illinois,”
—David Bagot, President, Illinois Pharmacists Association
However, the Pharmaceutical Care Management Association, a PBM lobbying group, criticized the bill, claiming it would have minimal impact on drug prices. They contend that drug manufacturers, not PBMs, are the primary drivers of high costs.
Since 2016, Illinois has enacted 20 bills to regulate PBMs, with no resulting decrease in drug prices, the association claimed.
Expanding Insurance Coverage
Governor Pritzker also signed House Bill 3019, the Healthcare Protection Expansion Act. This law aims to improve access to healthcare services.
The new law prohibits state-regulated health plans from requiring prior authorization for outpatient mental health services, building upon previous legislation that already addressed inpatient and emergency mental health services. This removes an obstacle to timely care.
Additionally, the act mandates that insurance plans cover patient travel costs for in-network care when extensive travel is necessary. This is particularly relevant for those living in rural areas.
“Building on protections that make mental health care accessible for all Illinois residents, this law gives people more opportunities and flexibility to receive necessary services,”
—Laura Fine, State Senator
According to a 2024 report, medication costs are a key factor in healthcare spending, representing a significant financial burden for many Americans (KFF, 2024).
Impact and Future Outlook
These legislative actions signify a broader commitment to healthcare affordability and access within Illinois. By targeting PBM practices and expanding coverage, the state is taking steps to address critical issues in the healthcare system. These reforms could set a precedent for other states.