Texas Should Protect Pharmacy Benefits, and Stop Picking Industry Winners
Texas lawmakers are rightly focused on healthcare affordability, including the rising price of prescription drugs. For the last few months, the House Select Committee on Health Care Affordability has examined cost drivers, transparency, affordability, access, and employer coverage barriers to both medical care and prescription drug access.
Prescription drugs are an important part of the healthcare affordability conversation because it’s clear that prices continue to go up. A federal analysis found that more than 4,200 drugs had list-price increases between January 2022 and 2023 averaging 15.2%, with nearly half rising faster than inflation.
How the Texas legislature responds to these price increases will directly impact both the health of patients and our economy. Affordable coverage means more Texans take their medications as prescribed. According to the National Center for Health Statistics, cost caused 18.1% of uninsured adults to skip doses, take less medication or delay filling a prescription, compared with 6.6% of adults with private drug coverage and 7.6% with public coverage. From an economic standpoint, affordable health benefits help Texas employers recruit and retain workers, as 72% of workers cite health insurance as a top factor in deciding whether to stay or leave a job.
All of this means that getting policy solutions right matters and has a direct, real world impact on Texas families. Unfortunately, politics and special interest groups can distract from that mission, because their lobbyists too often point lawmakers towards self-serving “solutions” with no real benefit to consumers.
Pharmacists and pharmaceutical companies, for instance, have become increasingly vocal about the work of pharmacy benefit managers who administer prescription benefits, negotiate manufacturer discounts and establish pharmacy payment arrangements on behalf of health plans and employers
If successfully deployed, pharmacy benefit managers lower prescription drug costs for health plans and, in turn, consumers. Pharmacists and drug manufacturers argue that their practices can squeeze pharmacy margins, fueling these companies to push lawmakers to intervene in ways that can weaken these negotiations and ultimately raise costs for consumers.
As per our mission, TAHC would be opposed to any legislative intervention that would have the unintended consequences of raising consumer costs or limiting access to care, including for medications.
Lawmakers Should Reject Reforms That Benefit Special Interests at the Expense of Patients
One particularly troubling legislative proposal we’ve seen is a government-mandated minimum “dispensing fee,” a required payment to pharmacies for filling prescriptions, separate from reimbursement for the medication itself. Supporters argue these mandates help independent pharmacies stay in business, but when the government requires payments above negotiated rates, it raises the cost of providing prescription coverage.
Iowa offers a recent cautionary example. In May 2025, the state estimated a proposed $10.68 dispensing fee will add $4.7 million annually to the state employee health plan’s costs and $1.2 million in higher member copays. Analysts said the fee could make some inexpensive generics more costly. And those estimates only relate to the state plan, not private-sector costs, which will be astronomically higher.
Another proposal prohibits certain ownership ties between pharmacy benefit managers and pharmacies, potentially forcing some chain pharmacies that are frequently accessed by Texans to sell, restructure or stop operating. Texas lawmakers introduced a similar proposal, HB 5457, in 2025.
Forcing pharmacy benefit managers and affiliated pharmacies to separate is a problem because of the likely disruption of services that many Texans already rely on. That includes military families and retirees covered by TRICARE. TRICARE’s home-delivery program is one of its most affordable and convenient service options.
Specialty pharmacy services for Texans managing complex illnesses would also be disrupted. And, of course, if you are a customer of certain chain pharmacies in the state, you may be forced to move to a different pharmacy.
Neither of these policies -- mandatory dispensing fees and forced pharmacy closures -- are helpful to patients in Texas. They are targeted special interest giveaways, heavily lobbied by industry groups that would benefit directly from more money being spent in pharmacies and less competition from some of the chain pharmacies most of us use.
The Focus Needs to Be on Reducing Costs
Texas should pursue reforms that deliver measurable savings for patients and employers while preserving access to the pharmacies and services they rely on. That could include encouraging greater use of lower-cost generics and biosimilars, promoting transparent and competitive contracting, and removing barriers that prevent health plans from negotiating better prices.
Texas lawmakers should also examine the entire prescription-drug supply chain—including manufacturers, wholesalers, pharmacy benefit managers and pharmacies—rather than adopting policies that advantage one industry at another’s expense. Every proposal should be evaluated according to its effect on the people paying the bill, not the political popularity of the industry supporting or opposing it.
Before imposing a new mandate, Texas lawmakers should ask: Who will pay more? Could patients in my state lose access to a pharmacy, medication or delivery service they currently use? Will the proposal increase competition or protect certain businesses from it? Most importantly, what credible evidence shows it will make prescriptions more affordable for Texans?
The Texas Legislature deserves credit for taking a serious look at the forces driving healthcare costs. The next step is to advance solutions that produce lower prices, stronger competition and reliable access, not policies that increase costs, restrict patient choice or use government to pick winners and losers.