---
title: HB 196. State employees' health insurance plan; drugs dispensed for self-administration; provisions
collection: bills
id: 2025-2026/hb196
cite_as: HB 196, 2025-2026 Regular Session (Ga.)
canonical_url: https://georgiacommons.org/bills/2025-2026/hb196
md_url: https://georgiacommons.org/bills/2025-2026/hb196.md
text_url: https://georgiacommons.org/bills/2025-2026/hb196/text
source_url: https://www.legis.ga.gov/legislation/69712
date: 2025-05-14
status: passed
corpus_version: bills-2026-08-28
license: Public record of the Georgia General Assembly, via LegiScan; see about.md
publisher: Georgia Commons, an independent project of Georgia Civic Data. Not the State of Georgia. Not legal advice.
up: https://georgiacommons.org/bills/2025-2026.md
previous: https://georgiacommons.org/bills/2025-2026/hb195.md
next: https://georgiacommons.org/bills/2025-2026/hb197.md
index: https://georgiacommons.org/bills/index.md
omitted: votes and history
omitted_chars: 1227
omitted_url: https://georgiacommons.org/bills/2025-2026/hb196.md?full=1
bill_number: HB 196
session: 2025-2026 Regular Session
session_slug: 2025-2026
chamber: House
bill_type: bill
status_date: 2025-05-14
last_action: Effective Date 2025-07-01
sponsors:
  - Trey Kelley
  - Darlene Taylor
  - James Hatchett
  - Carolyn Hugley
  - Rick Jasperse
  - Matthew Gambill
  - Matt Brass
text_version: Enrolled
has_text: true
legiscan_url: https://legiscan.com/GA/bill/HB196/2025
upstream_id: 1949614
summaries_model: claude-sonnet-5
topic_tags:
  - prescription drug pricing
  - state employee health insurance
  - pharmacy reimbursement
  - health insurance regulation
  - pharmacy benefits managers
---

# HB 196. State employees' health insurance plan; drugs dispensed for self-administration; provisions

## Text

25 HB 196/AP
House Bill 196 (AS PASSED HOUSE AND SENATE)
By: Representatives Kelley of the 16th, Taylor of the 173rd, Hatchett of the 155th, Hugley of
the 141st, Jasperse of the 11th, and others
A BILL TO BE ENTITLED
AN ACT
To amend Part 1 of Article 1 of Chapter 18 of Title 45 of the O fficial Code of Georgia1
Annotated, relating to state employees' health insurance plan, so as to require that drugs2
dispensed to a covered person for self-administration under a state health plan be reimbursed3
using a transparent, index based price, plus a dispensing fee; to provide for enforcement4
authority by the Commissioner of Insurance; to provide for definitions; to provide for related5
matters; to repeal conflicting laws; and for other purposes.6
BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:7
SECTION 1.8
Part 1 of Article 1 of Chapter 18 of Title 45 of the Official C ode of Georgia Annotated,9
relating to state employees' health insurance plan, is amended by adding a new Code section10
to read as follows:11
"45-18-22.12
(a) As used in this Code section, the term:13
(1) 'Independent pharmacy' means an entity contracted with the PBM pursuant to an14
agreement with a single retail pharmacy, or is contracted with the PBM through a15
pharmacy services administrative organization.16
H. B. 196
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25 HB 196/AP
(2) 'Insurer' means a corporation licensed to transact acciden t and sickness or major17
medical insurance business in this state, a healthcare corporation, a health maintenance18
organization, a pharmacy benefits manager, or any other entity that provides healthcare19
coverage or services pursuant to a state health plan. Such term shall not include any20
licensed group model health maintenance organization with an exclusive medical group21
contract and which operates its own pharmacies which are licens ed under Code22
Section 26-4-110.23
(3) 'National average drug acquisition cost' means the monthly survey of retail24
pharmacies conducted by the federal Centers for Medicare and Me dicaid Services to25
determine average acquisition cost for Medicaid covered outpatient drugs.26
(4) 'Pharmacy' means a pharmacy or pharmacist licensed or hold ing a nonresident27
pharmacy permit pursuant to Chapter 4 of Title 26.28
(5) 'Pharmacy benefits manager' or 'PBM' means a person, business entity, or other entity29
that performs pharmacy benefits management as such term is defi ned in Chapter 64 of30
Title 33. The term 'pharmacy benefits manager' includes a person or entity acting for a31
pharmacy benefits manager in a contractual or employment relati onship in the32
performance of pharmacy benefits management for a health plan, including operating or33
administering a prescription card or prescription discount program directly or on behalf34
of a pharmacy benefits manager or insurer for covered persons for drugs not covered or35
being reimbursed by the covered person's pharmacy benefits mana ger or health plan. 36
Such term shall not include services provided by pharmacies operating under a hospital37
pharmacy license. Such term shall not include health systems while providing pharmacy38
services for their patients, employees, or beneficiaries, for i ndigent care, or for the39
provision of drugs for outpatient procedures. Such term shall not include services40
provided by pharmacies affiliated with a facility licensed under Code Section 31-44-4 or41
a licensed group model health maintenance organization with an exclusive medical group42
H. B. 196
- 2 -
25 HB 196/AP
contract and which operates its own pharmacies which are licens ed under Code43
Section 26-4-110.44
(6) 'State health plan' means:45
(A) The state employees' health insurance plan established pursuant to this article;46
(B) The health insurance plan for public school teachers and the health insurance plan47
for public school employees established pursuant to Subparts 2 and 3, respectively, of48
Part 6 of Article 17 of Chapter 2 of Title 20; and49
(C) The health benefit plan established for members, employees , and retirees of the50
Board of Regents of the University System of Georgia pursuant to Code Section 31-2-4.51
(b)(1) On and after January 1, 2026, an insurer shall reimburs e a pharmacy for a drug52
dispensed to a covered person for self-administration in the state health plan in an amount53
equal to:54
(A) The national average drug acquisition cost on the day of claim administration or,55
if unavailable, a discounted percentage of the average wholesal e price or wholesale 56
acquisition cost on the day of claim administration as determin ed by the state health57
plan based on current competitive market rates or, if unavailab le, the wholesale58
acquisition cost; and59
(B) A professional dispensing fee that is not less than $10.50 for chain pharmacies and60
$11.50 for independent pharmacies.61
(2) Nothing in this subsection shall prohibit a state health p lan from authorizing62
reimbursement by an insurer to a pharmacy for a drug or drugs in excess of but not lower63
than the amount required pursuant to paragraph (1) of this subsection.64
(c) An insurer shall not circumvent the requirements regarding pharmacy reimbursement65
in this Code section in any manner, including without limitatio n by adjudicating claims66
through a prescription drug discount card or program.67
(d) The Commissioner of Insurance shall have enforcement autho rity over this Code68
section and to take any other actions pursuant to any authority granted under Chapter 6469
H. B. 196
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25 HB 196/AP
of Title 33, relating to the regulation and licensure of pharmacy benefits managers. Such70
authority shall be in addition to any authority granted to the applicable state health plan71
under contract or law."72
SECTION 2.73
All laws and parts of laws in conflict with this Act are repealed.74
H. B. 196
- 4 -

## Summaries written by Georgia Commons

The following was written by claude-sonnet-5 from the text above and is not part of the bill. Quote the text, not the summary.

House Bill 196 requires state health plans in Georgia, including plans covering state employees, teachers, school staff, and University System employees, to reimburse pharmacies for self-administered drugs using a transparent, index-based pricing formula plus a set dispensing fee.

### Plain-language summary

Currently, how pharmacy benefits managers (companies that process prescription drug claims) reimburse pharmacies for drugs under Georgia's state health plans is not tied to a specific transparent pricing method. This bill adds a new section to Georgia law (O.C.G.A. § 45-18-22) that changes that starting January 1, 2026.
Under the bill, insurers, including pharmacy benefits managers, must pay pharmacies based on the national average drug acquisition cost (a federal survey of what pharmacies actually pay for drugs) or, if that is not available, a discounted average wholesale price. On top of that, insurers must pay a dispensing fee of at least $10.50 for chain pharmacies and $11.50 for independent pharmacies. Insurers cannot get around these rules by routing claims through prescription discount cards or similar programs. The bill also gives the Commissioner of Insurance authority to enforce these requirements, in addition to whatever oversight state health plans already have under their contracts.

### What it does

- Requires insurers to reimburse pharmacies for self-administered drugs under state health plans using the national average drug acquisition cost or a comparable wholesale price benchmark, starting January 1, 2026.
- Sets a minimum professional dispensing fee of $10.50 for chain pharmacies and $11.50 for independent pharmacies on top of the drug cost reimbursement.
- Bans insurers from avoiding these reimbursement rules by processing claims through prescription discount cards or similar workaround programs.
- Gives the Commissioner of Insurance enforcement authority over these pharmacy reimbursement rules, in addition to existing state health plan oversight.
- Defines key terms such as 'insurer,' 'pharmacy benefits manager,' 'independent pharmacy,' and 'state health plan' to clarify who the new rules apply to.

### Who it affects

The bill affects insurers and pharmacy benefits managers handling Georgia's state health plans, chain and independent pharmacies that dispense drugs to covered members, and the state employees, public school teachers and staff, and University System of Georgia employees and retirees covered by those plans.

### Why it matters

Pharmacies serving state health plan members would receive a guaranteed, transparent reimbursement formula and a minimum dispensing fee rather than rates set solely by pharmacy benefits managers, which could affect pharmacy finances, especially for independent pharmacies, and how drug costs are calculated within state health plans.

### Key provisions

- Section 1 adds new Code Section 45-18-22, defining terms including 'insurer,' 'independent pharmacy,' 'national average drug acquisition cost,' 'pharmacy,' and 'pharmacy benefits manager.'
- Subsection (a)(6) defines 'state health plan' to include the state employees' plan, the teacher and school employee health plans, and the Board of Regents' health benefit plan.
- Subsection (b)(1) requires, effective January 1, 2026, reimbursement based on the national average drug acquisition cost or a discounted average wholesale/acquisition price, plus a dispensing fee of at least $10.50 (chain) or $11.50 (independent pharmacies).
- Subsection (b)(2) allows state health plans to authorize higher, but not lower, reimbursement than the required minimum.
- Subsection (c) prohibits insurers from circumventing the reimbursement rules, including through prescription discount cards or programs.
- Subsection (d) grants the Commissioner of Insurance enforcement authority under Chapter 64 of Title 33, governing pharmacy benefits managers, in addition to existing state health plan authority.
- Section 2 repeals any conflicting laws.

## Status

- Status: Passed (2025-05-14)
- Last action: Effective Date 2025-07-01 (2025-05-14)
- Sponsors: Trey Kelley, Darlene Taylor, James Hatchett, Carolyn Hugley, Rick Jasperse, Matthew Gambill, Matt Brass
- Official page: https://www.legis.ga.gov/legislation/69712

> The history, votes, and amendments (1,227 characters) are at https://georgiacommons.org/bills/2025-2026/hb196.md?full=1