Document ID: ./input/supremecourt_opinions/opinions/20pdf/18-540_m64o.pdf
Page Number: 6

Cite as:  592 U. S. ____ (2020) 

3 

Opinion of the Court 

the  pharmacy’s  acquisition  cost. 

wholesaler, a PBM must increase its reimbursement rate to 
  §17–92–
cover 
507(c)(4)(C)(i)(b).  PBMs must also allow pharmacies to “re-
verse and rebill” each reimbursement claim affected by the 
pharmacy’s  inability  to  procure  the  drug  from  its  typical 
wholesaler at a price equal to or less than the MAC reim-
bursement  price.    §17–92–507(c)(4)(C)(iii).    Third,  and  fi-
nally, the Act permits a pharmacy to decline to sell a drug 
to  a  beneficiary  if  the  relevant  PBM  will  reimburse  the 
pharmacy at less than its acquisition cost.  §17–92–507(e). 

B 
  Respondent Pharmaceutical Care Management Associa-
tion  (PCMA)  is  a  national  trade  association  representing 
the 11 largest PBMs in the country.  After the enactment of 
Act 900, PCMA filed suit in the Eastern District of Arkan-
sas, alleging, as relevant here, that Act 900 is pre-empted 
by ERISA.  See 29 U. S. C. §1144(a) (ERISA pre-empts “any 
and all State laws insofar as they may now or hereafter re-
late to any employee benefit plan”). 
  Before the District Court issued its opinion in response to 
the  parties’  cross-motions  for  summary  judgment,  the 
Court of Appeals for the Eighth Circuit decided, in a differ-
ent  case,  that  ERISA  pre-empts  a  similar  Iowa  statute.  
Pharmaceutical Care Mgmt. Assn. v. Gerhart, 852 F. 3d 722 
(2017).  The Eighth Circuit concluded that the Iowa statute 
was  pre-empted  for  two  reasons.    First,  it  made  “implicit 
reference”  to  ERISA  by  regulating  PBMs  that  administer 
benefits for ERISA plans.  Id., at 729.  Second, it was im-
permissibly  “connected  with”  an  ERISA  plan  because,  by 
requiring  an  appeal  process  for  pharmacies  to  challenge 
PBM reimbursement rates and restricting the sources from 
which PBMs could determine pricing, the law limited a plan 
administrator’s  ability  to  control  the  calculation  of  drug 
benefits.  Id., at 726, 731.  Concluding that Arkansas’ Act 
900 contains similar features, the District Court held that