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SB493

Regular Session

Relating to protection of certain disclosures and communications by pharmacists and pharmacies regarding prescription drug benefits.

Moderate
Low Cost
Effective:2025-09-01
SB493
Moderate
Relating to protection of certain disclosures and communications by pharmacists and pharmacies regarding prescription drug benefits.
Moderate Compliance Urgency
Requires near-term attention
Cost Impact
Low
Effective
2025-09-01
Enforcing Agencies
Texas Department of Insurance
Primary Author: Sen. Lois Kolkhorst
89th Texas Legislature
jdkey.com
01

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

  • Effective Date: September 1, 2025
  • Compliance Deadline: Compliance is triggered immediately upon the execution, amendment, or renewal of any contract on or after September 1, 2025. Existing contracts remain valid until their next renewal date.
  • Agency Rulemaking: The statute is self-executing regarding contract validity. While the Texas Department of Insurance (TDI) has oversight, businesses should not await further rulemaking to update contract templates.

Immediate Action Plan

  • Legal Review (Immediate): General Counsel must draft a "SB 493 Compliance Addendum" for all contracts renewing post-August 2025.
  • Audit Renewals: Identify all "evergreen" (auto-renewing) contracts scheduled to renew shortly after September 1, 2025. These are your first compliance targets.
  • Update Workflows: Pharmacies must configure software to allow "cash pay" bypass without triggering insurance adjudication errors.
  • Communication Protocol: Pharmacies intending to contact Plan Sponsors should draft standardized talking points to ensure they stay within the statutory protections (network adequacy/reimbursement) and avoid defamation risks.

Operational Changes Required

Contracts

  • PBMs: Must immediately redline standard Pharmacy Provider Agreements and Provider Manuals. Clauses prohibiting price disclosure or communication with plan sponsors must be struck for all agreements renewing after August 31, 2025.
  • Pharmacies: Must review renewal addendums. If a PBM attempts to renew a contract containing these restrictions after the effective date, the provision is legally void, but signing it creates unnecessary liability risk.

Hiring/Training

  • Pharmacy Staff: Point-of-sale staff must be trained to proactively check "cash price" vs. "copay price." Staff must be instructed that they are legally protected to disclose this data *before* adjudication.
  • PBM Provider Relations: Teams must be retrained to cease issuing breach of contract notices for price disclosures or plan sponsor communications under new contracts.

Reporting & Record-Keeping

  • Contract Version Control: Organizations must tag all contracts with "Legacy" (pre-Sept 1, 2025) or "Compliant" (post-Sept 1, 2025) status to determine which restrictive covenants are still enforceable during the transition period.
  • Defensive Logging: Pharmacies should document instances where patients opt for cash pricing to create an audit trail proving the pharmacy complied with SB 493 rather than improperly "steering" patients.

Fees & Costs

  • No New State Fees: There are no new licensure fees associated with this bill.
  • Revenue Impact: Pharmacies may see an increase in direct cash revenue; PBMs may see a decrease in spread pricing revenue retained from copays that exceed drug costs.

Strategic Ambiguities & Considerations

  • Scope of "Communication": The law permits pharmacies to discuss "prescription claim reimbursement" with Plan Sponsors. It is unclear if this protects direct solicitation of business (bypassing the PBM) or merely complaints about rates. PBMs may challenge communications that look like trade secret violations or tortious interference.
  • Deductible Accumulation: The law does not mandate that cash payments count toward patient deductibles. Pharmacies disclosing lower prices must be prepared to explain to patients that choosing the lower cash price may result in the transaction not applying to their insurance deductible.

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Information presented is for general knowledge only and is provided without warranty, express or implied. Consult qualified government affairs professionals and legal counsel before making compliance decisions.

02

Legislative Timeline

This bill's path through the Texas Legislature

Filed
Nov 22, 2024
Passed Senate
Apr 10, 2025
Passed House
May 20, 2025
Signed
Jun 20, 2025
TopicsInsuranceInsurance--health & AccidentOccupational RegulationOccupational Regulation--health OccupationsMedicine & Prescription DrugsPharmacies & PharmacistsPharmacy Benefit Managers
03

Senate Authors

Sen. Lois KolkhorstRepublican · Primary Author
Coauthors (4)

House Sponsor

Rep. Trey WhartonRepublican · Primary Sponsor

Bill Text(with markup)

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

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Quick Reference

Frequently Asked Questions

Common questions about SB493

Q

What does Texas SB493 do?

SB 493 statutorily voids contractual "gag clauses" between Pharmacy Benefit Managers (PBMs) and pharmacists, fundamentally altering the enforceability of provider agreements. Effective September 1, 2025, PBMs are prohibited from restricting pharmacists from disclosing lower cash prices to patients or communicating directly with plan sponsors regarding reimbursement and network adequacy. Implementation Timeline Effective Date: September 1, 2025 Compliance Deadline: Compliance is triggered immediately upon the execution, amendment, or renewal of any contract on or after September 1, 2025.

Q

Who authored SB493?

SB493 was authored by Texas Senator Lois Kolkhorst during the Regular Session.

Q

When was SB493 signed into law?

SB493 was signed into law by Governor Greg Abbott on June 20, 2025.

Q

Which agencies enforce SB493?

SB493 is enforced by Texas Department of Insurance.

Q

How urgent is compliance with SB493?

The compliance urgency for SB493 is rated as "moderate". Businesses and organizations should review the requirements and timeline to ensure timely compliance.

Q

What is the cost impact of SB493?

The cost impact of SB493 is estimated as "low". This may vary based on industry and implementation requirements.

Q

What topics does SB493 address?

SB493 addresses topics including insurance, insurance--health & accident, occupational regulation, occupational regulation--health occupations and medicine & prescription drugs.

Legislative data provided by LegiScanLast updated: November 25, 2025

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