Ind. Code ch. 27-1-24.5

Ind. Code ch. 27-1-24.5
in effect

Ind. Code § 27-1-24.5-0.7 "Contract holder"

Sec. 0.7. As used in this chapter, "contract holder" means: (1) an individual or entity that offers health insurance coverage to its employees or members through a self-funded health benefit plan, including a self-funded health benefit plan that complies with the federal Employee Retirement Income Security Act (ERISA) of 1974 (29 U.S.C. 1001 et seq.); (2) a health plan; or (3) Medicaid or a managed care organization (as defined in IC 12-7-2.1-218) that provides services to a Medicaid recipient; that contracts with a pharmacy benefit manager to provide services. As added by P.L.152-2024, SEC.11. Amended by P.L.145-2026, SEC.141.

Ind. Code § 27-1-24.5-0.8 "Cost sharing"

Sec. 0.8. As used in this chapter, "cost sharing" means any copayment, coinsurance, deductible, or other similar charge that is: (1) required of a covered individual for a health care service covered by a health plan, including a prescription drug; and (2) paid: (A) by; or (B) on behalf of; the covered individual. As added by P.L.237-2025, SEC.1.

Ind. Code § 27-1-24.5-1 "Covered individual"

Sec. 1. As used in this chapter, "covered individual" means an individual who is entitled to coverage under a health plan. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-2 "Effective rate of reimbursement"

Sec. 2. As used in this chapter, "effective rate of reimbursement" includes the following: (1) Generic effective rates. (2) Brand effective rates. (3) Direct and indirect remuneration fees. (4) Any other reduction or aggregate reduction of payment. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-3 "Equal access and incentives"

Sec. 3. As used in this chapter, "equal access and incentives" means that a pharmacy benefit manager allows any willing pharmacy provider to participate as part of any of the pharmacy benefit manager's networks as long as the pharmacy provider agrees to the terms and conditions of the relevant contract applicable to any other pharmacy provider within that network. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-4 "Generic drug"

Sec. 4. As used in this chapter, "generic drug" means a drug product that is identified by the drug's chemical name and that is: (1) accepted by the federal Food and Drug Administration; (2) available from at least three (3) sources; and (3) therapeutically equivalent to an originating brand name drug. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-4.5 "Health care service"

Sec. 4.5. As used in this chapter, "health care service" means a service or good furnished for the purpose of preventing, alleviating, curing, or healing: (1) human illness; (2) physical disability; or (3) injury. As added by P.L.237-2025, SEC.2.

Ind. Code § 27-1-24.5-5 "Health plan"

Sec. 5. As used in this chapter, "health plan" means a plan through which coverage is provided for health care services through insurance, prepayment, reimbursement, or otherwise. The term includes the following: (1) A state employee health plan (as defined in IC 5-10-8-6.7). (2) A policy of accident and sickness insurance (as defined in IC 27-8-5-1). However, the term does not include the coverages described in IC 27-8-5-2.5(a). (3) An individual contract (as defined in IC 27-13-1-21) or a group contract (as defined in IC 27-13-1-16) that provides coverage for basic health care services (as defined in IC 27-13-1-4). (4) Any other plan or program that provides payment, reimbursement, or indemnification to a covered individual for the cost of prescription drugs. As added by P.L.68-2020, SEC.1. Amended by P.L.207-2021, SEC.52; P.L.237-2025, SEC.3.

Ind. Code § 27-1-24.5-6 "Independent pharmacies"

Sec. 6. As used in this chapter, "independent pharmacies" means pharmacies that are not a pharmacy benefit manager affiliate. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-6.5 "Insurer"

Sec. 6.5. As used in this chapter, "insurer" means an insurer subject to state law and rules regulating insurance or subject to the jurisdiction of the department that contracts, or offers to contract, to: (1) provide; (2) deliver; (3) arrange for; (4) pay for; or (5) reimburse; any of the costs of health care services to a covered individual under a health plan. As added by P.L.237-2025, SEC.4.

Ind. Code § 27-1-24.5-7 "Maximum allowable cost"

Sec. 7. As used in this chapter, "maximum allowable cost" means the maximum amount that a pharmacy benefit manager will reimburse a pharmacy for the cost of a generic drug. The term does not include a dispensing fee or professional fee. As added by P.L.68-2020, SEC.1. Amended by P.L.32-2021, SEC.76.

Ind. Code § 27-1-24.5-8 "Maximum allowable cost list"

Sec. 8. As used in this chapter, "maximum allowable cost list" means a list of drugs that is used: (1) by a pharmacy benefit manager; and (2) to set the maximum amount that may be reimbursed to a pharmacy or pharmacist for a drug. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-9 "Pharmacist"

Sec. 9. As used in this chapter, "pharmacist" means an individual licensed as a pharmacist under IC 25-26. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-10 "Pharmacist services"

Sec. 10. As used in this chapter, "pharmacist services" means products, goods, and services provided as part of the practice of pharmacy. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-11 "Pharmacy"

Sec. 11. As used in this chapter, "pharmacy" means the physical location: (1) that is licensed under IC 25-26; and (2) at which drugs, chemicals, medicines, prescriptions, and poisons are compounded, dispensed, or sold at retail. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-11.5 "Pharmacy benefit management services"

Sec. 11.5. As used in this chapter, "pharmacy benefit management services" means: (1) negotiating the price of prescription drugs, including negotiating and contracting for direct or indirect rebates, discounts, or other price concessions; (2) managing any aspect of a prescription drug benefit, including: (A) the processing and payment of claims for prescription drugs; (B) arranging alternative access to or funding for prescription drugs; (C) the performance of drug utilization review; (D) the processing of drug prior authorization requests; (E) the adjudication of appeals or grievances related to the prescription drug benefit; (F) contracting with network pharmacies; (G) controlling the cost of covered prescription drugs; (H) managing or providing data relating to the prescription drug benefit; (I) the provision of services related to the prescription drug benefit; or (J) creating or updating prescription drug formularies; (3) the performance of any administrative, managerial, clinical, pricing, financial, reimbursement, data administration or reporting, or billing service; and (4) any other services specified in a rule adopted by the department. As added by P.L.237-2025, SEC.5.

Ind. Code § 27-1-24.5-12 "Pharmacy benefit manager"

Sec. 12. (a) As used in this chapter, "pharmacy benefit manager" means: (1) a person who, under a written agreement with an insurer, health plan, state agency, managed care organization, or other third party payor, directly or indirectly provides one (1) or more pharmacy benefit management services on behalf of the insurer, health plan, state agency, managed care organization, or other third party payor; and (2) an agent, a contractor, an intermediary, an affiliate, a subsidiary, or a related entity of a person described in subdivision (1) who facilitates, provides, directs, or oversees the provision of the pharmacy benefit management services. (b) The term does not include the following: (1) A person licensed under IC 16. (2) A health provider who is: (A) described in IC 25-0.5-1; and (B) licensed or registered under IC 25. (3) A consultant who only provides advice concerning the selection or performance of a pharmacy benefit manager. As added by P.L.68-2020, SEC.1. Amended by P.L.32-2021, SEC.77; P.L.237-2025, SEC.6.

Ind. Code § 27-1-24.5-13 "Pharmacy benefit manager affiliate"

Sec. 13. As used in this chapter, "pharmacy benefit manager affiliate" means a pharmacy or pharmacist that directly or indirectly, through one (1) or more intermediaries: (1) owns or controls; (2) is owned or controlled by; or (3) is under common ownership or control with; a pharmacy benefit manager. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-14 "Pharmacy benefit manager network"

Sec. 14. As used in this chapter, "pharmacy benefit manager network" means a group of pharmacies or pharmacists that is offered: (1) through an agreement or health plan contract; and (2) to provide pharmacist services for health plans. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-15 "Pharmacy services administrative organization"

Sec. 15. As used in this chapter, "pharmacy services administrative organization" means an organization that assists independent pharmacies and pharmacy benefit managers or health plans to achieve administrative efficiencies, including contracting and payment efficiencies. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-16 "Rebate"

Sec. 16. (a) As used in this chapter, "rebate" means a discount or other price concession that is: (1) based on use of a prescription drug; and (2) paid by a manufacturer or third party to a pharmacy benefit manager, pharmacy services administrative organization, or pharmacy after a claim has been processed and paid at a pharmacy. (b) The term includes an incentive and a disbursement. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-17 "Third party"

Sec. 17. As used in this chapter, "third party" means a person other than a: (1) pharmacy benefit manager; or (2) covered individual. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-18 Licensure

Sec. 18. A person shall, before establishing or operating as a pharmacy benefit manager, apply to and obtain a license from the commissioner under this chapter. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-19 Equal access and incentives; prohibited acts

Sec. 19. (a) A pharmacy benefit manager shall provide equal access and incentives to all pharmacies within the pharmacy benefit manager's network. (b) A pharmacy benefit manager may not do any of the following: (1) Condition participation in any network on accreditation, credentialing, or licensing of a pharmacy, other than a license or permit required by the Indiana board of pharmacy or other state or federal regulatory authority for the services provided by the pharmacy. However, nothing in this subdivision precludes the department from providing credentialing or accreditation standards for pharmacies. (2) Discriminate against any pharmacy. (3) Directly or indirectly retroactively deny a claim or aggregate of claims after the claim or aggregate of claims has been adjudicated, unless any of the following apply: (A) The original claim was submitted fraudulently. (B) The original claim payment was incorrect because the pharmacy or pharmacist had already been paid for the drug. (C) The pharmacist services were not properly rendered by the pharmacy or pharmacist. (4) Reduce, directly or indirectly, payment to a pharmacy for pharmacist services to an effective rate of reimbursement, including permitting an insurer or plan sponsor to make such a reduction. (5) Reimburse a pharmacy that is affiliated with the pharmacy benefit manager, other than solely being included in the pharmacy benefit manager's network, at a greater reimbursement rate than other pharmacies in the same network. (6) Impose limits, including quantity limits or refill frequency limits, on a pharmacy's access to medication that differ from those existing for a pharmacy benefit manager affiliate. (7) Share any covered individual's information, including de-identified covered individual information, received from a pharmacy or pharmacy benefit manager affiliate, except as permitted by the federal Health Insurance Portability and Accountability Act (HIPAA) (P.L.104-191). A violation of this subsection by a pharmacy benefit manager constitutes an unfair or deceptive act or practice in the business of insurance under IC 27-4-1-4. As added by P.L.68-2020, SEC.1. Amended by P.L.32-2021, SEC.78; P.L.196-2021, SEC.22.

Ind. Code § 27-1-24.5-19.5 Federal drug pricing program

Sec. 19.5. (a) This section does not apply to: (1) a Medicaid managed care organization (as defined in 42 U.S.C. 1396b(m)); and (2) the state Medicaid program when Medicaid provides reimbursement for covered outpatient drugs (as defined in 42 U.S.C. 1396r-8(k)) on a fee for service basis. (b) As used in this section, "340B covered entity" means an entity authorized to participate in the federal 340B Drug Pricing Program under Section 340B(a)(4) of the federal Public Health Service Act (42 U.S.C. 256b(a)(4)) and includes any pharmacy under contract with the entity to dispense drugs on behalf of the entity. (c) The following provisions may not be contained in a contract between a pharmacy benefit manager and a 340B covered entity: (1) A reimbursement rate for a prescription drug that would diminish the 340B benefit to a 340B covered entity. (2) A fee or adjustment that is not imposed on a pharmacy that is not a 340B covered entity. (3) A fee or adjustment amount that exceeds the fee or adjustment amount imposed on a pharmacy that is not a 340B covered entity. (4) Any provision that prevents or interferes with an individual's choice to receive a prescription drug from a 340B covered entity, including the administration of the drug. (5) Any provision that excludes a 340B covered entity from pharmacy benefit manager networks based on the 340B covered entity's participation in the federal 340B Drug Pricing Program. (6) Any provision that discriminates against a 340B covered entity. A violation of this subsection by a pharmacy benefit manager constitutes an unfair or deceptive act or practice in the business of insurance under IC 27-4-1-4. (d) For contracts between a pharmacy benefit manager and a 340B covered entity that are entered into, amended, or renewed after June 30, 2021, a provision that violates subsection (c) is considered void and unenforceable. As added by P.L.196-2021, SEC.23. Amended by P.L.213-2025, SEC.298.

Ind. Code § 27-1-24.5-20 Acts of the commissioner; confidentiality

Sec. 20. (a) The commissioner shall do the following: (1) Prescribe an application for use in applying for a license to operate as a pharmacy benefit manager. (2) Adopt rules under IC 4-22-2 to establish the following: (A) Pharmacy benefit manager licensing requirements. (B) Licensing fees. (C) A license application. (D) Financial standards for pharmacy benefit managers. (E) Reporting requirements described in sections 21 and 29 of this chapter. (F) The time frame for the resolution of an appeal under section 22 of this chapter. (b) The commissioner may do the following: (1) Charge a license application fee and renewal fees established under subsection (a)(2) in an amount not to exceed five hundred dollars ($500) to be deposited in the department of insurance fund established by IC 27-1-3-28. (2) Examine or audit the books and records of a pharmacy benefit manager one (1) time per year to determine if the pharmacy benefit manager is in compliance with this chapter. (3) Adopt rules under IC 4-22-2 to: (A) implement this chapter; and (B) specify requirements for the following: (i) Prohibited market conduct practices. (ii) Data reporting in connection with violations of state law. (iii) Maximum allowable cost list compliance and enforcement requirements, including the requirements of sections 22 and 23 of this chapter. (iv) Prohibitions and limits on pharmacy benefit manager practices that require licensure under IC 25-22.5. (v) Pharmacy benefit manager affiliate information sharing. (vi) Lists of health plans administered by a pharmacy benefit manager in Indiana. (vii) Pharmacy benefit management services included under section 11.5(4) of this chapter. (c) Financial information and proprietary information submitted by a pharmacy benefit manager to the department is confidential. As added by P.L.68-2020, SEC.1. Amended by P.L.158-2024, SEC.8; P.L.237-2025, SEC.7.

Ind. Code § 27-1-24.5-21 Annual reporting requirements; trade secrets

Sec. 21. (a) Beginning June 1, 2021, and annually thereafter, a pharmacy benefit manager shall submit a report containing data from the immediately preceding calendar year to the commissioner. The commissioner shall determine what must be included in the report and consider the following information to be included in the report: (1) The aggregate amount of all rebates that the pharmacy benefit manager received from all pharmaceutical manufacturers for: (A) all insurers; and (B) each insurer; with which the pharmacy benefit manager contracted during the immediately preceding calendar year. (2) The aggregate amount of administrative fees that the pharmacy benefit manager received from all pharmaceutical manufacturers for: (A) all insurers; and (B) each insurer; with which the pharmacy benefit manager contracted during the immediately preceding calendar year. (3) The aggregate amount of retained rebates that the pharmacy benefit manager received from all pharmaceutical manufacturers and did not pass through to insurers with which the pharmacy benefit manager contracted during the immediately preceding calendar year. (4) The highest, lowest, and mean aggregate retained rebate for: (A) all insurers; and (B) each insurer; with which the pharmacy benefit manager contracted during the immediately preceding calendar year. (b) A pharmacy benefit manager that provides information under this section may designate the information as a trade secret (as defined in IC 24-2-3-2). Information designated as a trade secret under this subsection must not be published unless required under subsection (c). (c) Disclosure of information designated as a trade secret under subsection (b) may be ordered by a court of Indiana for good cause shown or made in a court filing. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-22 Required information; appeals process; auditing procedures

Sec. 22. (a) A pharmacy benefit manager shall do the following: (1) Identify to contracted: (A) pharmacy services administrative organizations; or (B) pharmacies if the pharmacy benefit manager contracts directly with pharmacies; the sources used by the pharmacy benefit manager to calculate the drug product reimbursement paid for covered drugs available under the pharmacy health plan administered by the pharmacy benefit manager. (2) Establish an appeal process for contracted pharmacies, pharmacy services administrative organizations, or group purchasing organizations to appeal and resolve disputes concerning the maximum allowable cost pricing. (3) Update and make available to pharmacies: (A) at least every seven (7) days; or (B) in a different time frame if contracted between a pharmacy benefit manager and a pharmacy; the pharmacy benefit manager's maximum allowable cost list. (4) Determine that a prescription drug: (A) is not obsolete; (B) is generally available for purchase by pharmacies in Indiana from a national or regional wholesaler licensed in Indiana; and (C) is not: (i) temporarily unavailable; (ii) listed on a drug shortage list; or (iii) unable to be lawfully substituted; before the prescription drug is placed or continued on a maximum allowable cost list. (b) The appeal process required by subsection (a)(2) must include the following: (1) The right to appeal a claim not to exceed sixty (60) days following the initial filing of the claim. (2) The investigation and resolution of a filed appeal by the pharmacy benefit manager in a time frame determined by the commissioner. (3) If an appeal is denied, a requirement that the pharmacy benefit manager do the following: (A) Provide the reason for the denial. (B) Provide the appealing contracted pharmacy, pharmacy services administrative organization, or group purchasing organization with the national drug code number of the prescription drug that is available from a national or regional wholesaler operating in Indiana. (4) If an appeal is approved, a requirement that the pharmacy benefit manager do the following: (A) Change the maximum allowable cost of the drug for the pharmacy that filed the appeal as of the initial date of service that the appealed drug was dispensed. (B) Adjust the maximum allowable cost of the drug for the appealing pharmacy and for all other contracted pharmacies in the same network of the pharmacy benefit manager that filled a prescription for patients covered under the same health plan beginning on the initial date of service the appealed drug was dispensed. (C) Notify each pharmacy in the pharmacy benefit manager's network that the maximum allowable cost for the drug has been adjusted as a result of an approved appeal. (D) Adjust the drug product reimbursement for contracted pharmacies that resubmit claims to reflect the adjusted maximum allowable cost, if applicable. (E) Allow the appealing pharmacy and all other contracted pharmacies in the network that filled the prescriptions for patients covered under the same health plan to reverse and resubmit claims and receive payment based on the adjusted maximum allowable cost from the initial date of service the appealed drug was dispensed. (F) Make retroactive price adjustments in the next payment cycle unless otherwise agreed to by the pharmacy. (5) The establishment of procedures for auditing submitted claims by a contracted pharmacy in a manner established by administrative rules under IC 4-22-2 by the department. The auditing procedures: (A) may not use extrapolation or any similar methodology; (B) may not allow for recovery by a pharmacy benefit manager of a submitted claim due to clerical or other error where the patient has received the drug for which the claim was submitted; (C) must allow for recovery by a contracted pharmacy for underpayments by the pharmacy benefit manager; and (D) may only allow for the pharmacy benefit manager to recover overpayments on claims that are actually audited and discovered to include a recoverable error. (c) The department must approve the manner in which a pharmacy benefit manager may respond to an appeal filed under this section. The department shall establish a process for a pharmacy benefit manager to obtain approval from the department under this section. As added by P.L.68-2020, SEC.1. Amended by P.L.32-2021, SEC.79; P.L.196-2021, SEC.24.

Ind. Code § 27-1-24.5-22.5 Aggregated information from pharmacy benefit manager reports

Sec. 22.5. Aggregated information compiled from reports submitted by pharmacy benefit managers to the insurance commissioner under section 22 of this chapter is not confidential except for information that would reveal a specific pharmacy benefit manager's proprietary information. As added by P.L.114-2020, SEC.15.

Ind. Code § 27-1-24.5-22.6 Filing complaints with department of insurance

Sec. 22.6. (a) If a pharmacy benefit manager denies an appeal under section 22(a)(2) of this chapter, the appealing contracted pharmacy, pharmacy services administrative organization, or group purchasing organization may file a complaint with the department not later than thirty (30) days from the date of the denial. The department may request additional information from either party as necessary to resolve a complaint. (b) If a contracted pharmacy or pharmacy services administrative organization believes that its contract with a pharmacy benefit manager contains an unlawful contractual provision regarding reimbursement rates, the contracted pharmacy or pharmacy services administrative organization may file a complaint with the department. (c) A pharmacy benefit manager that receives written notice of a complaint filed under this section shall promptly conduct an investigation of the matters alleged in the complaint. Not later than twenty (20) business days after the date of the complaint, the pharmacy benefit manager shall provide to the department and the complaining party a written report containing the following information: (1) The specific actions taken by the pharmacy benefit manager with respect to: (A) the appeal, for a complaint filed under subsection (a); or (B) the contract, for a complaint filed under subsection (b). (2) A good faith estimate of the time required for a resolution of the complaint. (d) If a pharmacy believes that its contract with a pharmacy services administrative organization contains an unlawful contractual provision regarding reimbursement rates, the pharmacy may file a complaint with the department. (e) The department shall establish a process for complaints filed under this section. As added by P.L.196-2021, SEC.25.

Ind. Code § 27-1-24.5-23 Drug price data

Sec. 23. (a) For every drug for which the pharmacy benefit manager establishes a maximum allowable cost to determine the drug product reimbursement, the pharmacy benefit manager shall make available to a contracted pharmacy services administrative organization to make available to the pharmacies, or to a pharmacy if the pharmacy benefit manager contracts directly with a pharmacy, in a manner established by the department by administrative rule described in subsection (b) the following: (1) Information identifying the national drug pricing compendia or sources used to obtain the drug price data. (2) The comprehensive list of drugs subject to maximum allowable cost and the actual maximum allowable cost for each drug. (b) The department shall adopt rules under IC 4-22-2 concerning the manner in which a pharmacy benefit manager shall communicate the following to contracted pharmacy services administrative organizations: (1) Drug price data should be used to establish drug reimbursements by pharmacy benefit managers as described in subsection (a)(1). (2) The comprehensive list of drugs described in subsection (a)(2). (c) The department may, concerning a maximum allowable cost list, consider whether a drug is: (1) obsolete; (2) temporarily unavailable; (3) to be included on a drug shortage list; or (4) unable to be lawfully substituted. As added by P.L.68-2020, SEC.1. Amended by P.L.32-2021, SEC.80.

Ind. Code § 27-1-24.5-24 Information necessary for appeal

Sec. 24. (a) For every drug for which a pharmacy benefit manager establishes a maximum allowable cost to determine reimbursement for the drug product, the pharmacy benefit manager shall make available to the department, upon request of the department, information that is needed to resolve an appeal. (b) If the pharmacy benefit manager fails to promptly make available to the department the information as required in subsection (a), the department shall consider the appeal granted in favor of the appealing pharmacy. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-25 Contract holder's right to audit; disclosure of data; amounts paid; consideration

Sec. 25. (a) A contract holder may, one (1) time in a calendar year and not earlier than six (6) months following a previously requested audit, request an audit of compliance with the contract. If requested by the contract holder, the audit shall include full disclosure of the following data specific to the contract holder: (1) Rebate amounts secured on prescription drugs, whether product specific or general rebates, that were provided by a pharmaceutical manufacturer. The information provided under this subdivision must identify the prescription drugs by therapeutic category. (2) Pharmaceutical and device claims received by the pharmacy benefit manager on any of the following: (A) The CMS-1500 form or its successor form. (B) The HCFA-1500 form or its successor form. (C) The HIPAA X12 837P electronic claims transaction for professional services, or its successor transaction. (D) The HIPAA X12 837I institutional form or its successor form. (E) The CMS-1450 form or its successor form. (F) The UB-04 form or its successor form. The forms or transaction may be modified as necessary to comply with the federal Health Insurance Portability and Accountability Act (HIPAA) (P.L. 104-191). (3) Pharmaceutical and device claims payments or electronic funds transfer or remittance advice notices provided by the pharmacy benefit manager as ASC X12N 835 files or a successor format. The files may be modified as necessary to comply with the federal Health Insurance Portability and Accountability Act (HIPAA) (P.L. 104-191). In the event that paper claims are provided, the pharmacy benefit manager shall convert the paper claims to the ASC X12N 835 electronic format or a successor format. (4) Any other revenue and fees derived by the pharmacy benefit manager from the contract, including all direct and indirect remuneration from pharmaceutical manufacturers regardless of whether the remuneration is classified as a rebate, fee, or another term. (b) A pharmacy benefit manager may not impose the following: (1) Fees for: (A) requesting an audit under this section; or (B) selecting an auditor other than an auditor designated by the pharmacy benefit manager. (2) Conditions that would restrict a contract holder's right to conduct an audit under this section, including restrictions on the: (A) time period of the audit; (B) number of claims analyzed; (C) type of analysis conducted; (D) data elements used in the analysis; or (E) selection of an auditor as long as the auditor: (i) does not have a conflict of interest; (ii) meets a threshold for liability insurance specified in the contract between the parties; (iii) does not work on a contingent fee basis; and (iv) does not have a history of breaching nondisclosure agreements. (c) A pharmacy benefit manager shall disclose, upon request from a contract holder, to the contract holder the actual amounts directly or indirectly paid by the pharmacy benefit manager to the pharmacist or pharmacy for the drug and for pharmacist services related to the drug. (d) A pharmacy benefit manager shall provide notice to a contract holder contracting with the pharmacy benefit manager of any consideration, including direct or indirect remuneration, that the pharmacy benefit manager receives from a pharmaceutical manufacturer or group purchasing organization for formulary placement or any other reason. (e) The commissioner may establish a procedure to release information from an audit performed by the department to a contract holder that has requested an audit under this section in a manner that does not violate confidential or proprietary information laws. (f) A contract that is entered into, issued, amended, or renewed after June 30, 2024, may not contain a provision that violates this section. (g) A pharmacy benefit manager shall: (1) obtain any information requested in an audit under this section from a group purchasing organization or other partner entity of the pharmacy benefit manager; and (2) provide claims data to the contract holder not later than fifteen (15) business days after the information or claims data is requested. (h) Information provided in an audit under this section must be provided in accordance with the federal Health Insurance Portability and Accountability Act (HIPAA) (P.L. 104-191). As added by P.L.68-2020, SEC.1. Amended by P.L.32-2021, SEC.81; P.L.152-2024, SEC.12; P.L.216-2025, SEC.40; P.L.186-2025, SEC.294; P.L.215-2025, SEC.47.

Ind. Code § 27-1-24.5-26 Disclosure of contract with another party

Sec. 26. A person or entity that has contracted with a pharmacy benefit manager for the performance of services described in section 12(a) of this chapter is entitled to full disclosure from the pharmacy benefit manager of the terms of a contract between the pharmacy benefit manager and any other person or entity within the same network concerning the performance of the services described in section 12(a) of this chapter, including: (1) the purchase price for prescription drugs within the same network and set by a contract entered into by the pharmacy benefit manager; and (2) the amount of any rebate provided in connection with the purchase of prescription drugs within the same network by a contract entered into by the pharmacy benefit manager. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-27 Contracts of pharmacy services administrative organizations

Sec. 27. A pharmacy services administrative organization shall, upon request, fully disclose to an independent pharmacy on whose behalf the pharmacy services administrative organization acts the terms of a contract between the pharmacy services administrative organization and any other person or entity concerning the actions taken by the pharmacy services administrative organization on behalf of the independent pharmacy. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-27.5 Pharmacist may not be required to collect higher copayment for prescription drug

Sec. 27.5. A pharmacy benefit manager may not require a pharmacy or pharmacist to collect a higher copayment for a prescription drug from a customer than the pharmacy benefit manager allows the pharmacy or pharmacist to retain. As added by P.L.114-2020, SEC.16. Amended by P.L.32-2021, SEC.82.

Ind. Code § 27-1-24.5-27.7 Limitation on cost sharing; calculating covered individual's contribution

Sec. 27.7. (a) This section applies to a health plan that is issued, delivered, amended, or renewed after December 31, 2025. (b) A pharmacy benefit manager shall apply the annual limitation on cost sharing set forth in the federal Patient Protection and Affordable Care Act under 42 U.S.C. 18022(c)(1) to prescription drugs that: (1) are covered under a health plan administered by the pharmacy benefit manager; (2) are life-saving or intended to manage chronic pain; and (3) do not have an approved generic version. (c) Except as provided in subsection (d), when calculating a covered individual's contribution to an applicable cost sharing requirement, a pharmacy benefit manager must include any cost sharing amounts paid: (1) by the covered individual; or (2) on behalf of the covered individual by another person. (d) If application of subsection (c) would result in a covered individual becoming ineligible for a health savings account under Section 223 of the Internal Revenue Code, the requirement under subsection (c) applies with respect to the deductible of a high deductible health plan after the covered individual satisfies the minimum deductible under Section 223 of the Internal Revenue Code. However, subsection (c) applies to items or services that are preventative care under Section 223(c)(2)(C) of the Internal Revenue Code regardless of whether the minimum deductible under Section 223 of the Internal Revenue Code is satisfied. (e) A pharmacy benefit manager may not directly or indirectly: (1) set; (2) alter; (3) implement; or (4) condition; the terms of health plan coverage, including the benefit design, based in part or entirely on information about the availability or amount of financial or product assistance available for a prescription drug. As added by P.L.237-2025, SEC.8.

Ind. Code § 27-1-24.5-28 Violation of chapter

Sec. 28. (a) A violation of this chapter is an unfair or deceptive act or practice in the business of insurance under IC 27-4-1-4. (b) The department may also adopt rules under IC 4-22-2 to set forth fines for a violation under this chapter. As added by P.L.68-2020, SEC.1.

Ind. Code § 27-1-24.5-29 Report

Sec. 29. (a) At least every six (6) months, a pharmacy benefit manager shall provide a report to the department. (b) A report under subsection (a) must include the: (1) overall aggregate amount charged to a health plan for all pharmaceutical claims processed by the pharmacy benefit manager; and (2) overall aggregate amount paid to pharmacies for claims processed by the pharmacy benefit manager. (c) Upon request, the department shall make a report received under subsection (a) available to the members of the general assembly in an electronic format under IC 5-14-6. As added by P.L.166-2023, SEC.1.
Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://iga.in.gov/laws/2026/ic/titles/27Fetched: 10/17/2026

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