# AR Insurance Bulletin 18-2023: Failure to adhere to Anti-Clawback Law and Failure to Lawfully adjust pricing in Compliance with MAC and NADAC Law

> Arkansas · Agency guidance · In force

URL: https://www.frixlaw.com/law-library/statutes/AR_INS_B_2023-18

## Section

- **Citation:** AR Insurance Bulletin 18-2023
- **Heading:** Failure to adhere to Anti-Clawback Law and Failure to Lawfully adjust pricing in Compliance with MAC and NADAC Law
- **Jurisdiction:** Arkansas
- **Kind:** Agency guidance
- **Status:** In force
- **Text as of:** August 14, 2026
- **Source:** Compiled text
- **Location:** Arkansas Insurance Department Bulletins and Directives / Failure to adhere to Anti-Clawback Law and Failure to Lawfully adjust pricing in Compliance with MAC and NADAC Law

## Text

Hugh McDonald
SECRETARY OF COMMERCE
AID
IMUILUNICIE
[...I141011
*
*
BULLETIN NO: 18-2023
Alan McClain
COMMISSIONER,
ARKANSAS INSURANCE
DEPARTMENT
TO:
PHARMACY BENEFITS MANAGERS, HEALTH INSURERS, HEALTH
MAINTENANCE ORGANIZATIONS, HOSPITAL PUBLIC SERVICE
CORPORATIONS, HEALTHCARE PAYORS, AND OTHER
INTERESTED PARTIES
FROM:
ARKANSAS INSURANCE DEPARTMENT
SUBJECT:
FAILURE TO ADHERE TO ANTI-CLAWBACK LAW AND FAILURE
TO LAWFULLY ADJUST PRICING IN COMPLIANCE WITH MAC
AND NADAC LAWS
The Arkansas Insurance Commissioner issues this Bulletin to all licensed
pharmacy benefits managers ("PBMs") transacting business in this state and any other
PBMs transacting business in this state subject to Arkansas' Maximum Allowable Cost
("MAC") Law Ark. Code Ann. § 17-92-507, the Department has received several
complaints relating to prohibited practices by PBMs.
Failure to Comply with Prohibition Against Clawbacks
The "Patient Rights Regarding Payment for Pharmacists Service Act," codified at
Ark. Code Ann. § 4-88-1001 et seq., prohibits PBMs from engaging in a practice known
as "clawback." A clawback occurs when a PBM charges an insured a higher copay or
coinsurance amount than what the PBM will ultimately pay to the pharmacy filling the
prescription. Although the pharmacy collects the higher copay or coinsurance charged
by the PBM, the PBM will reduce future payments to the pharmacy to take back the
difference in price from the pharmacy.
Pursuant to Ark. Code Ann. § 4-88-1004, "[air' individual shall not be required to
make a payment for pharmacists services in an amount greater than the pharmacist or
pharmacy providing the pharmacists services may retain from all payment sources."
Lately, the Department has seen many examples of an insured's copay exceeding
the total reimbursement a pharmacy filling the prescription is allowed to keep. PBMs are
advised this practice was prohibited by Arkansas law in 2015, remains illegal today, and
is subject to enforcement by the Department
pharmacist or
pharmacy providing the pharmacists services may retain from all payment sources."
Lately, the Department has seen many examples of an insured's copay exceeding
the total reimbursement a pharmacy filling the prescription is allowed to keep. PBMs are
advised this practice was prohibited by Arkansas law in 2015, remains illegal today, and
is subject to enforcement by the Department.
Arkansas Department of Commerce
Arkansas Insurance Department
1 Commerce Way, Suite 102 • Little Rock, AR 72202
INSURANCE.ARKANSAS.GOV

Pricing Adjustments by PBMs that Effectively Create Negative Remits in Violation of
MAC and NADAC Law
Several pharmacists have complained to the Department about PBM
reimbursement processes that fail to comply with Arkansas law. The Department does
not consider a PBM to be in compliance with Arkansas's Maximum Allowable Cost
("MAC") Law, Ark. Code Ann. § 17-92-507, or National Average Drug Acquisition Cost
("NADAC") Law, Ark. Code Ann. § 23-92-506(b)(5), when a pharmacy successfully
appeals a MAC or NADAC price, and the pharmacy is told that it will need to collect the
difference in price from an insured.
The Department understands that when some PBMs adjust claims following a
successful drug pricing appeal by a pharmacy, the software used by the PBM is set to
increase an insured's share of the drug price, resulting in a higher amount of coinsurance
that the PBM tells the pharmacy to obtain from the insured to make up for the difference
in the paid price and the successfully appealed price.
Regardless of the agreements between, or plan design approved by an insurer or
payor and PBM, a PBM cannot avoid its duty to properly reimburse a pharmacy by
requiring the pharmacy to collect funds from an insured. It is the PBM's responsibility
to make sure that its processes are compliant with Arkansas law, and when such
processes fail to comply, it is equally important that the PBM's processes do not place
additional burdens upon the pharmacy
pproved by an insurer or
payor and PBM, a PBM cannot avoid its duty to properly reimburse a pharmacy by
requiring the pharmacy to collect funds from an insured. It is the PBM's responsibility
to make sure that its processes are compliant with Arkansas law, and when such
processes fail to comply, it is equally important that the PBM's processes do not place
additional burdens upon the pharmacy.
The Department does not consider a PBM that responds to an adjusted claim by
instructing a pharmacy to collect additional funds from an insured to be compliant with
Arkansas MAC or NADAC Laws. The Department also considers this process to result
in failure to provide a reasonable MAC appeal process.
Finally, the Commissioner advises all PBMs servicing plans within the
Department's jurisdiction of new penalties for violation of MAC and NADAC Laws that
became effective August 1, 2023.
If you have any questions or concerns, please feel free to email the following
aid.pbmlicensing@arkansas.gov.
c.U......
J 1-1 -1.--z
ALAN MCCLAIN
DATE
ARKANSAS INSURANCE COMMISSIONER
2

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/AR_INS_B_2023-18. Check the current official text before relying on it. Not legal advice.