Gov. Gavin Newsom (D) signed AB 116, the health omnibus trailer bill that contains the specific statutory language to implement the governor's PBM reform policies as outlined in the state's main budget bill. AB 116 requires PBMs to be licensed and regulated by the Department of Managed Health Care (DMHC), the same agency that also regulates health plans in the state. PBMs must obtain and maintain a license with DMHC on or after January 1, 2027, or the date on which DMHC has established the licensure process. DMHC is authorized to charge an annual fee on PBMs to support the department's actual and reasonably necessary expenses to implement PBM licensure and oversight. DMHC is also authorized to suspend or revoke a PBM license or assess administrative penalties if the director determines the licensee has committed acts or omissions constituting grounds for disciplinary action. The Pharmacy Benefit Manager Fund will be established to receive fees, fines, penalties and reimbursements to support regulation of PBMs. DMHC is authorized to conduct periodic routine and non-routine examinations of the fiscal and administrative affairs of any PBM. Furthermore, PBMs must inform its contracted pharmacists of the right to submit complaints to DMHC and must provide certain data to the Department of Health Care Access and Information (HCAI). A PBM also has a fiduciary duty to its payer client that includes a duty to be fair and truthful toward the payer, to act in the payer's best interests, and to perform its duties with care, skill, prudence and diligence.
Also in California, the Department of Health Care Services (DHCS) is establishing Medi-Cal provider enrollment requirements and procedures for pharmacy providers that hold a Clinical Laboratory Improvement Amendments (CLIA) Certificate of Waiver. Effective August 1, 2025, pharmacy providers that hold a valid Clinical Laboratory Improvement Amendments (CLIA) Certificate of Waiver and current Certificate of California Clinical Laboratory Registration may bill for CLIA-waived tests provided within the pharmacist's scope of practice as defined by the Board of Pharmacy and authorized in Business and Professions Code Section 4052.4. Pharmacy providers must apply to enroll in the Medi-Cal program by submitting a Medi-Cal provider enrollment online application, along with all supporting documentation. Providers can access Medi-Cal provider enrollment information on the DHCS Provider Enrollment Division webpage.
Finally in California, the Department of Health Care Service posted the following alerts and monthly bulletin on the Medi-Cal Rx Web Portal.
For more information, contact NACDS’ Sandra Guckian at 703-774-4801.
