Massachusetts Introduces Legislation to Regulate Pharmacy Benefit Managers
On February 3, 2026, the Massachusetts Center for Health Information and Analysis (CHIA) introduced a transformative new standard for Pharmacy Benefit Manager (PBM) reporting under 957 CMR 12.00. If passed, this regulation would mark a significant leap forward in transparency and accountability of PBMs doing business in Massachusetts.
Why 957 CMR 12.00 Matters
As prescription drug spending continues to rise, stakeholders across the healthcare spectrum, patients and providers are demanding greater insight into the complex world of pharmacy benefits. 957 CMR 12.00 responds to this call by establishing uniform, comprehensive reporting requirements for PBMs operating in Massachusetts.
If enacted, this regulation would ensure that critical data on drug utilization, pricing, rebates and PBM business practices are consistently reported to CHIA to enhance transparency, better-informed policy decisions and a more equitable healthcare system.
Key Requirements at a Glance
1. Annual PBM Reporting
- PBMs must submit detailed information about their organizational structure, payer contracts, total claims paid, fees received and the types of services provided.
- Contact and compliance officer details must be kept up to date.
2. Drug-Level Data Transparency
- For PBMs serving 3,000 members across all payers, annual reporting must include:
- Drug product names, National Drug Codes and drug categories (specialty, brand, generic, etc.).
- Utilization metrics: units dispensed, prescription counts, days’ supply and member counts broken down by programs like 340B.
- Cost and payment details: wholesale acquisition costs, dispensing fees, ingredient costs and total amount paid.
- Rebates and fees: amounts retained or passed through to payers and patients, administrative fees and other remuneration.
- Practices such as spread pricing, formulary placement and post-sale adjustments.
3. Aggregated Data Across PBM-Payer Relationships
- PBMs must report summary metrics and financials for all drugs and contracted payers, ensuring a holistic view of pharmacy benefit management in the state.
4. Business and Network Insights
- Detailed descriptions of PBM ownership, service areas, pharmacy networks and reimbursement arrangements are required.
5. Rigorous Data Submission and Verification
- Data must be submitted according to CHIA’s technical guidance, with accuracy attested by an authorized representative.
- CHIA may request additional documentation or data resubmission to ensure accuracy.
Compliance: More Than a Mandate—A Strategic Imperative
If enacted, CHIA could impose penalties up to $25,000 per week for a PBM’s late or incomplete submissions, with additional sanctions possible; however, PBMs can request a hearing before penalties are assessed.
Safeguarding Sensitive Information
All submissions under 957 CMR 12.00 are protected as non-public records, with strict safeguards to prevent unauthorized disclosure of competitive or confidential information.
Conclusion
Massachusetts's introduction of 957 CMR 12.00 signals a decisive shift in how PBMs operate in Massachusetts. As the healthcare landscape demands greater clarity and fairness in prescription drug pricing and benefit management, Massachusetts legislation is a step towards regulating PBMs and promoting transparency. If enacted, this regulation stands as a critical step toward demystifying the financial flows and business practices that impact patients and providers.