LA| Directive 257 explains how the Louisiana Department of Insurance is implementing Act 474 by setting a minimum “fair and reasonable” reimbursement standard for local pharmacies: pharmacy benefit managers (PBMs) serving Louisiana health plans (fully insured, self-funded, and governmental, but not Medicare, Medicaid, or OGB plans) must use a reimbursement formula based on NADAC plus a combined 9.00 markup and professional dispensing fee (PDF) for a 30‑day supply, which LDI identifies as the market‑based minimum that satisfies the statutory requirement that payments to local pharmacies include a non‑nominal, fair, and reasonable PDF; this determination is grounded in legislative history (Acts 768 and 474 and the rejection of a Medicaid‑level PDF floor), historical NADAC implementation (including the Office of Group Benefits’ 9.00 PDF), and a 2026 data call showing prevailing commercial formulas, while clarifying that LDI has no authority to impose a Medicaid‑equivalent PDF floor and giving PBMs until March 1, 2026 to bring their contracts and systems into compliance.
Key Points:
- The directive rejects using Medicaid’s 11.81 PDF as a mandatory floor, finding no statutory authority for such a requirement and emphasizing that LDI’s role is to enforce fair and reasonable compensation based on commercial market practice, not to “hide” a higher PDF floor in general oversight language.
- PBMs subject to Act 474 must reimburse local pharmacies using a NADAC‑based formula that includes a real, non‑de minimis professional dispensing fee, with benefits like Medicare, Medicaid, and OGB expressly excluded.
- LDI concludes that any PBM formula paying less than NADAC plus a combined 9.00 markup and PDF per 30‑day supply is per se not fair and reasonable under Louisiana law and must be corrected by March 1, 2026.