An Act to Direct the Maine Prescription Drug Affordability Board to Assess Strategies to Reduce Prescription Drug Costs and to Take Steps to Implement Reference-based Pricing

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STATE OF MAINE
_____
IN THE YEAR OF OUR LORD
TWO THOUSAND TWENTY-FIVE
_____
S.P. 314 - L.D. 697
An Act to Direct the Maine Prescription Drug Affordability Board to Assess
Strategies to Reduce Prescription Drug Costs and to Take Steps to
Implement Reference-based Pricing
Be it enacted by the People of the State of Maine as follows:
Sec. 1. 5 MRSA §2041, sub-§2, as repealed and replaced by PL 2021, c. 293, Pt.
A, §5, is amended to read:
2. Membership. The board has 5 consists of 6 members with expertise in health
policy, health care data, health care economics or clinical medicine, who may not be
affiliated with or represent the interests of a pharmaceutical manufacturer or a public payor,
as that term is defined in section 2042, and who are appointed as follows:
A. Two members appointed by the President of the Senate. The President of the Senate
shall also appoint one alternate board member who will participate in deliberations of
the board in the event a member appointed by the President of the Senate elects to be
recused as provided in subsection 7, paragraph B;
B. Two members appointed by the Speaker of the House of Representatives. The
Speaker of the House of Representatives shall also appoint one alternate board member
who will participate in deliberations of the board in the event a member appointed by
the Speaker of the House of Representatives elects to be recused as provided in
subsection 7, paragraph B; and
C. One member appointed by the Governor. The Governor shall also appoint one
alternate board member who will participate in deliberations of the board in the event
the member appointed by the Governor elects to be recused as provided in subsection
7, paragraph B.; and
D. The executive director of the Maine Health Data Organization established by Title
22, section 8703, or the executive director's designee, who serves as an ex officio,
nonvoting member.
Sec. 2. 5 MRSA §2041, sub-§9, as repealed and replaced by PL 2021, c. 293, Pt.
A, §5, is amended to read:
LAW WITHOUT
GOVERNOR'S
SIGNATURE

JANUARY 11, 2026
CHAPTER
530
PUBLIC LAW
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9. Compensation. A Except for the member under subsection 2, paragraph D, a
member of the board and a member of the advisory council appointed pursuant to
subsection 10, paragraph L are entitled to legislative per diem and reimbursement for
expenses as provided in section 12004‑G, subsection 14‑I.
Sec. 3. 5 MRSA §2041, sub-§10, as repealed and replaced by PL 2021, c. 293, Pt.
A, §5, is amended to read:
10. Advisory council. A 12-member 13-member advisory council is established to
advise the board on establishing annual spending targets pursuant to section 2042,
subsection 1 and determining methods for meeting those spending targets pursuant to
section 2042, subsection 3. The advisory council consists of:
A. The Governor or the governor's designee;
B. The Commissioner of Administrative and Financial Services or the commissioner's
designee;
C. The Commissioner of Corrections or the commissioner's designee;
D. The Commissioner of Health and Human Services or the commissioner's designee;
E. The Attorney General or the Attorney General's designee;
F. The Executive Director of Employee Health and Benefits, within the Department
of Administrative and Financial Services, Bureau of Human Resources, or the
executive director's designee;
G. A representative from the Maine State Service Employees Association, appointed
by the Governor, based on a nomination by the association;
H. A representative from the Maine Education Association, appointed by the
Governor, based on a nomination by the association;
I. A representative from the Maine Municipal Association, appointed by the Governor,
based on a nomination by the association;
J. A representative from the University of Maine System, appointed by the Governor,
based on a nomination by the system;
K. A representative from the Maine Community College System, appointed by the
Governor, based on a nomination by the system; and
L. A representative of consumer interests, appointed by the Governor, who serves a
3‑year term.; and
M. A representative of health insurance carriers, appointed by the Governor, who
serves a 3-year term.
Sec. 4. 5 MRSA §2041, sub-§12, as repealed and replaced by PL 2021, c. 293, Pt.
A, §5, is repealed.
Sec. 5. 5 MRSA §2042, as repealed and replaced by PL 2021, c. 293, Pt. A, §5, is
amended to read:
§2042. Powers and duties of the board
The board has the following powers and duties.
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1. Prescription drug spending targets. The board has the following powers and
duties. For the purposes of this section, the term "public payor" means any division of state,
county or municipal government that administers a health plan for employees of that
division of state, county or municipal government or an association of state, county or
municipal employers that administers a health plan for its employees, except for the
MaineCare program. The board shall:
A. Beginning for the year 2021 and in consultation with the advisory council
established under section 2041, subsection 10, determine annual spending targets for
prescription drugs purchased by public payors based upon a 10-year rolling average of
the medical care services component of the United States Department of Labor, Bureau
of Labor Statistics Consumer Price Index medical care services index plus a reasonable
percentage for inflation and minus a spending target determined by the board for
pharmacy savings;
B. Determine spending targets on specific prescription drugs that may cause
affordability challenges to enrollees in a public payor health plan; and
C. Determine which public payors are likely to exceed the spending targets determined
under paragraph A.
1-A. Strategies to reduce costs of prescription drugs. The board shall:
A. Review prescription drug spending and utilization data to identify causes of high
spending or rising spending affecting public payors and private payors and impacting
consumers;
B. Solicit public input to identify cost-related barriers to accessing prescription drugs;
and
C. Assess strategies to reduce the cost of prescription drugs and reduce the rate of
growth in prescription drug spending and to reduce cost barriers for consumers. The
review of strategies must include consideration of the strategies' likely impact on
consumers and overall health care costs and the feasibility of implementing such
strategies. At a minimum, the board shall assess the following strategies:
(1) Empowering the board to assess the affordability of drugs and to establish
upper payment limits;
(2) Implementing reference-based pricing, including reviewing potential savings
for the state employee group health plan under Title 5, section 285 by
implementing reference-based pricing for the first 10 drugs negotiated under the
Medicare drug price negotiation program established in United States Public Law
117-169 (August 16, 2022);
(3) Recommending annual spending targets for prescription drugs for public
payors and implementing strategies for the purchase of prescription drugs by public
payors in order to meet those annual spending targets, including group purchasing
and formulary alignment. For the purposes of this subsection, the term "public
payor" means any division of state, county or municipal government that
administers a health plan for employees of that division of state, county or
municipal government or an association of state, county or municipal employers
that administers a health plan for its employees, except for the MaineCare program;
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(4) Recommending annual spending targets for prescription drugs that could be
applied to one or more segments of the state-regulated commercial insurance
market and implementing strategies to meet those annual spending targets;
(5) Implementing transparency requirements and regulation of supply chain
entities, including, but not limited to, pharmacy benefits managers, including
regarding the role of discounts and rebates in prescription drug costs;
(6) Implementing strategies to reduce out-of-pocket costs for prescription drugs
through the regulation of insurance and the rate review process of the Department
of Professional and Financial Regulation, Bureau of Insurance;
(7) Developing opportunities for engagement with providers and other health care
professionals to disseminate information about prescription drug costs and pricing;
and
(8) Aligning the payment for prescription drugs with actual drug acquisition costs.
1-B. Other states' experiences. To accomplish the duties under subsection 1-A, the
board shall consider and review the experiences of other states, including, but not limited
to, the role of prescription drug affordability boards established in other states that are
authorized to assess affordability of prescription drugs and to establish upper payment
limits or reference-based pricing requirements and their regulation of pharmacy benefits
managers.
2. Prescription drug spending data. The board may consider the following
prescription drug spending data to accomplish its duties under this section:
A. A public payor's prescription drug spending data, which the 3rd‑party administrator
or insurer for the public payor's health plan shall provide to the board on behalf of the
public payor upon request notwithstanding any provision of law to the contrary,
including:
(1) Expenditures and utilization data for prescription drugs for each plan offered
by a public payor;
(2) The formulary for each plan offered by a public payor and prescription drugs
common to each formulary;
(3) Pharmacy benefit management services and other administrative expenses of
the prescription drug benefit for each plan offered by a public payor; and
(4) Enrollee cost sharing for each plan offered by a public payor; and
B. Data compiled by the Maine Health Data Organization under Title 22, chapter
1683.; and
C. Publicly available data that is available for purchase or for free.
If there is additional data required by the board and its staff that is not already available
pursuant to paragraphs B and C, the board may recommend that the Maine Health Data
Organization adopt rules to collect additional prescription drug spending data, including
data relating to the prescription drugs common to each formulary. Prescription drug
spending data provided to the board and its staff under this subsection is confidential to the
same extent it is confidential while in the custody of the entity that provided the data to the
board.
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3. Recommendations. Based upon the prescription drug spending data received under
subsection 2, the board, in consultation with a representative of each public payor identified
under subsection 1, paragraph A, shall determine methods for the public payor to meet the
spending targets established under subsection 1. The board shall determine whether the
following methods reduce costs to individuals purchasing prescription drugs through a
public payor and allow public payors to meet the spending targets established under
subsection 1:
A. Negotiating specific rebate amounts on the prescription drugs that contribute most
to spending that exceeds the spending targets;
B. Changing a formulary when sufficient rebates cannot be secured under paragraph
A;
C. Changing a formulary with respect to all of the prescription drugs of a manufacturer
within a formulary when sufficient rebates cannot be secured under paragraph A;
D. Establishing a common prescription drug formulary for all public payors;
E. Prohibiting health insurance carriers in the State from offering on their formularies
a prescription drug or any of the prescription drugs manufactured by a particular
manufacturer when the methods described in paragraph B or C are implemented;
F. Purchasing prescription drugs in bulk or through a single purchasing agreement for
use among public payors;
G. Collaborating with other states and state prescription drug purchasing consortia to
purchase prescription drugs in bulk or to jointly negotiate rebates;
H. Allowing health insurance carriers providing coverage to small businesses and
individuals in the State to participate in the public payor prescription drug benefit for
a fee;
I. Procuring common expert services for public payors, including but not limited to
pharmacy benefit management services and actuarial services; and
J. Any other method the board may determine.
4. Report. The board shall report its any recommendations, including prescription
drug spending targets, and the progress of implementing those recommendations regarding
strategies to reduce the cost of prescription drugs, other states' experiences and prescription
drug spending data to the joint standing committee of the Legislature having jurisdiction
over health coverage and insurance matters no later than October 1, 2020 and on January
30th annually thereafter. The joint standing committee may report out legislation based
upon the report.
5. Rulemaking. The board may adopt rules to carry out the purposes of this chapter.
Rules adopted pursuant to this subsection are routine technical rules as defined by chapter
375, subchapter 2-A.
Sec. 6. 22 MRSA §8712, sub-§6, as enacted by PL 2019, c. 471, §3, is amended to
read:
6. Data shared with Maine Prescription Drug Affordability Board. The
organization may share data collected under this chapter with the Maine Prescription Drug
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Affordability Board, established under Title 5, section 12004‑G, subsection 14‑I, and its
staff as long as any data shared pursuant to this subsection is not further disseminated.
Sec. 7. Affordability program. The Maine Prescription Drug Affordability Board
established under the Maine Revised Statutes, Title 5, section 2041, referred to in this
section as "the board," in consultation with its advisory council established under Title 5,
section 2041, subsection 10 and any technical committees the board may establish, shall
develop a program to reduce the impact of prescription drug costs on the State's health care
system, stem the rate of growth in prescription drug spending and reduce cost barriers for
consumers. The program must be based on the prescription drug spending data received
under Title 5, section 2042, subsection 2 and the assessment conducted under Title 5,
section 2042, subsections 1-A and 1-B, include recommended implementation and
enforcement strategies and identify necessary funding and regulatory and legislative
authority.
1. The board shall adopt and submit a preliminary plan for a prescription drug
affordability program in its annual report due by January 30, 2026 pursuant to the Maine
Revised Statutes, Title 5, section 2042, subsection 4 to the Joint Standing Committee on
Health Coverage, Insurance and Financial Services. The preliminary plan must include
any proposals for legislative action needed to implement the program. The joint standing
committee may report out legislation based upon the report to the 133rd Legislature in
2027.
2. The board shall adopt and submit its final plan for a prescription drug affordability
program in a report to the joint standing committee of the Legislature having jurisdiction
over health coverage, insurance and financial services matters by October 1, 2027. The
final plan must include any proposals for legislative action needed to implement the
program. The joint standing committee may report out legislation based upon the report to
the Second Regular Session of the 133rd Legislature.
Sec. 8. Appropriations and allocations. The following appropriations and
allocations are made.
OFFICE OF AFFORDABLE HEALTH CARE
Office of Affordable Health Care Z320
Initiative: Establishes and provides funding for one Public Service Manager III position to
support the Maine Prescription Drug Affordability Board with strategic direction,
government and stakeholder relations, research, writing and administrative work effective
October 1, 2025.
GENERAL FUND 2025-26 2026-27
POSITIONS - LEGISLATIVE COUNT 1.000 1.000
Personal Services $105,855 $147,099
All Other $1,962 $2,019
__________ __________
GENERAL FUND TOTAL $107,817 $149,118