Impacted: All Prime clients in all lines of business

What you need to know

On June 11, 2025, the Governor of Iowa signed Senate File (SF) 383 into law, which contains provisions that impact pharmacy reimbursement. Before the law was set to take effect on July 1, a federal judge issued a temporary restraining order in response to a petition by a group of employers.

Overview

Under SF 383, pharmacy benefit managers (PBMs) are required to reimburse Iowa retail pharmacies located in the state at a rate no less than the National Average Drug Acquisition Cost (NADAC), or at Whole Sale Acquisition Cost (WAC) if no NADAC value exists, plus a professional dispensing fee of $10.68. Preliminary analysis of this change to reimbursement shows little increase and, in some cases, nominal savings for some clients. If you would like an impact analysis for your business specifically, please reach out to your Prime client account team representative. 

Additionally, on June 30, 2025, a group of employer plaintiffs were able to obtain an ex parte (without notice and a hearing) injunction of SF 383. The plaintiffs brought their petition for extraordinary relief based on Employee Retirement Income Security Act (ERISA), First Amendment and severability arguments. It is too early to predict the outcome of that litigation, particularly with respect to the pharmacy reimbursement mandate. The injunction protects the plaintiffs only and is temporary; a hearing has been scheduled for Monday, July 14, 2025.

Next steps

Prime has implemented a compliant solution and is currently assessing the impacts of this legislation. We will continue to monitor the lawsuit and any others, as well as any implementation guidance, and provide updates as they become available. 

Questions

Please reach out to your Prime client account team representative to discuss how this may affect your specific services.