STAND. COM. REP. NO. 2200

Honolulu, Hawaii

RE: S.B. No. 2047

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2026

State of Hawaii

Sir:

Your Committee on Health and Human Services, to which was referred S.B. No. 2047 entitled:

"A BILL FOR AN ACT RELATING TO PHARMACY BENEFIT MANAGERS,"

begs leave to report as follows:

The purpose and intent of this measure is to:

(1) Establish requirements for pharmacy benefit managers that reimburse contracting pharmacies for drugs on a maximum allowable cost basis, including maximum allowable cost lists, maximum allowable cost reports, and a complaint process;

(2) Require pharmacy benefit managers to disclose lower-priced equivalent drugs when a maximum allowable cost is upheld on appeal;

(3) Allow contracting pharmacies to reverse and rebill claims and recoup any overpayment if a maximum allowable cost is denied on appeal; and

(4) Authorize the Insurance Commissioner to adopt rules and assess fines for violations.

Your Committee received testimony in support of this measure from the State Health Planning and Development Agency, Office of Hawaiian Affairs, Hawaii Pharmacists Association, and one individual.

Your Committee received comments on this measure from the Department of Commerce and Consumer Affairs, Hawaiʻi Primary Care Association, and CVS.

Your Committee finds that pharmacy benefit manager (PBM) pricing practices that lack transparency, such as aggressively low maximum allowable cost (MAC) reimbursement rates or copayment structures that exceed the actual cost of a medication, can directly affect patients' out-of-pocket costs and disrupt access to needed medications. Your Committee further finds that when pharmacies are reimbursed below acquisition cost, they may be unable to sustainably dispense certain drugs, leading to delays, substitutions, or patients being forced to seek medications farther from home. This measure supports strong, enforceable oversight of maximum allowable cost pricing used by pharmacy benefit managers to improve transparency and fairness in prescription drug reimbursement.

Your Committee has amended this measure by:

(1) Inserting a blank appropriation amount for the Insurance Division of the Department of Commerce and Consumer Affairs to effectuate the purposes of this measure;

(2) Inserting an effective date of January 30, 2050, to encourage further discussion; and

(3) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

As affirmed by the record of votes of the members of your Committee on Health and Human Services that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2047, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2047, S.D. 1, and be referred to your Committees on Commerce and Consumer Protection and Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Health and Human Services,

________________________________

JOY A. SAN BUENAVENTURA, Chair