Full Text of SB0757 103rd General Assembly
SB0757sam001 103RD GENERAL ASSEMBLY | Sen. David Koehler Filed: 3/21/2023
| | 10300SB0757sam001 | | LRB103 03211 BMS 59435 a |
|
| 1 | | AMENDMENT TO SENATE BILL 757
| 2 | | AMENDMENT NO. ______. Amend Senate Bill 757 by replacing | 3 | | everything after the enacting clause with the following:
| 4 | | "Section 5. The Illinois Insurance Code is amended by | 5 | | changing Section 424 and by adding Section 513b7 as follows:
| 6 | | (215 ILCS 5/424) (from Ch. 73, par. 1031)
| 7 | | Sec. 424. Unfair methods of competition and unfair or | 8 | | deceptive acts or
practices defined. The following are hereby | 9 | | defined as unfair methods of
competition and unfair and | 10 | | deceptive acts or practices in the business of
insurance:
| 11 | | (1) The commission by any person of any one or more of | 12 | | the acts
defined or prohibited by Sections 134, 143.24c, | 13 | | 147, 148, 149, 151, 155.22,
155.22a, 155.42,
236, 237, | 14 | | 364, 469, and 513b1 , and 513b7 of this Code.
| 15 | | (2) Entering into any agreement to commit, or by any | 16 | | concerted
action committing, any act of boycott, coercion |
| | | 10300SB0757sam001 | - 2 - | LRB103 03211 BMS 59435 a |
|
| 1 | | or intimidation
resulting in or tending to result in | 2 | | unreasonable restraint of, or
monopoly in, the business of | 3 | | insurance.
| 4 | | (3) Making or permitting, in the case of insurance of | 5 | | the types
enumerated in Classes 1, 2, and 3 of Section 4, | 6 | | any unfair discrimination
between individuals or risks of | 7 | | the same class or of essentially the same
hazard and | 8 | | expense element because of the race, color, religion, or | 9 | | national
origin of such insurance risks or applicants. The | 10 | | application of this Article
to the types of insurance | 11 | | enumerated in Class 1 of Section 4 shall in no way
limit, | 12 | | reduce, or impair the protections and remedies already | 13 | | provided for by
Sections 236 and 364 of this Code or any | 14 | | other provision of this Code.
| 15 | | (4) Engaging in any of the acts or practices defined | 16 | | in or prohibited by
Sections 154.5 through 154.8 of this | 17 | | Code.
| 18 | | (5) Making or charging any rate for insurance against | 19 | | losses arising
from the use or ownership of a motor | 20 | | vehicle which requires a higher
premium of any person by | 21 | | reason of his physical disability, race, color,
religion, | 22 | | or national origin.
| 23 | | (6) Failing to meet any requirement of the Unclaimed | 24 | | Life Insurance Benefits Act with such frequency as to | 25 | | constitute a general business practice. | 26 | | (Source: P.A. 102-778, eff. 7-1-22.)
|
| | | 10300SB0757sam001 | - 3 - | LRB103 03211 BMS 59435 a |
|
| 1 | | (215 ILCS 5/513b7 new) | 2 | | Sec. 513b7. Pharmacy audits. | 3 | | (a) As used in this Section: | 4 | | "Audit" means any physical on-site, remote electronic, or | 5 | | concurrent review of a pharmacist service submitted to the | 6 | | pharmacy benefit manager or pharmacy benefit manager affiliate | 7 | | by a pharmacist or pharmacy for payment. | 8 | | "Auditing entity" means a person or company that performs | 9 | | a pharmacy audit. | 10 | | "Extrapolation" means the practice of inferring a | 11 | | frequency of dollar amount of overpayments, underpayments, | 12 | | nonvalid claims, or other errors on any portion of claims | 13 | | submitted, based on the frequency of dollar amount of | 14 | | overpayments, underpayments, nonvalid claims, or other errors | 15 | | actually measured in a sample of claims. | 16 | | "Misfill" means a prescription that was not dispensed; a | 17 | | prescription that was dispensed but was an incorrect dose, | 18 | | amount, or type of medication; a prescription that was | 19 | | dispensed to the wrong person; a prescription in which the | 20 | | prescriber denied the authorization request; or a prescription | 21 | | in which an additional dispensing fee was charged. | 22 | | "Pharmacy audit" means an audit conducted of any records | 23 | | of a pharmacy for prescriptions dispensed or nonproprietary | 24 | | drugs or pharmacist services provided by a pharmacy or | 25 | | pharmacist to a covered person. |
| | | 10300SB0757sam001 | - 4 - | LRB103 03211 BMS 59435 a |
|
| 1 | | "Pharmacy record" means any record stored electronically | 2 | | or as a hard copy by a pharmacy that relates to the provision | 3 | | of a prescription or pharmacy services or other component of | 4 | | pharmacist care that is included in the practice of pharmacy. | 5 | | (b) Notwithstanding any other law, when conducting a | 6 | | pharmacy audit, an auditing entity shall: | 7 | | (1) not conduct an on-site audit of a pharmacy at any | 8 | | time during the first 3 business days of a month or the | 9 | | first 2 weeks and final 2 weeks of the calendar year or | 10 | | during a declared State or federal public health | 11 | | emergency; | 12 | | (2) notify the pharmacy or its contracting agent no | 13 | | later than 30 days before the date of initial on-site | 14 | | audit; the notification to the pharmacy or its contracting | 15 | | agent shall be in writing and delivered either: | 16 | | (A) by mail or common carrier, return receipt | 17 | | requested; or | 18 | | (B) electronically with electronic receipt | 19 | | confirmation, addressed to the supervising pharmacist | 20 | | of record and pharmacy corporate office, if | 21 | | applicable, at least 30 days before the date of an | 22 | | initial on-site audit; | 23 | | (3) limit the audit period to 24 months after the date | 24 | | a claim is submitted to or adjudicated by the pharmacy | 25 | | benefit manager; | 26 | | (4) include in the written advance notice of an |
| | | 10300SB0757sam001 | - 5 - | LRB103 03211 BMS 59435 a |
|
| 1 | | on-site audit the list of specific prescription numbers to | 2 | | be included in the audit that may or may not include the | 3 | | final 2 digits of the prescription numbers; | 4 | | (5) use the written and verifiable records of a | 5 | | hospital, physician, or other authorized practitioner that | 6 | | are transmitted by any means of communication to validate | 7 | | the pharmacy records in accordance with State and federal | 8 | | law; | 9 | | (6) limit the number of prescriptions audited to no | 10 | | more than 100 randomly selected in a 12-month period and | 11 | | no more than one on-site audit per quarter of the calendar | 12 | | year, except in cases of fraud; | 13 | | (7) provide the pharmacy or its contracting agent with | 14 | | a copy of the preliminary audit report within 45 days | 15 | | after the conclusion of the audit; | 16 | | (8) be allowed to conduct a follow-up audit on site if | 17 | | a remote or desk audit reveals the necessity for a review | 18 | | of additional claims; | 19 | | (9) accept invoice audits as validation invoices from | 20 | | any wholesaler registered with the Department of Financial | 21 | | and Professional Regulation from which the pharmacy has | 22 | | purchased prescription drugs or, in the case of durable | 23 | | medical equipment or sickroom supplies, invoices from an | 24 | | authorized distributor other than a wholesaler; | 25 | | (10) provide the pharmacy or its contracting agent | 26 | | with the ability to provide documentation to address a |
| | | 10300SB0757sam001 | - 6 - | LRB103 03211 BMS 59435 a |
|
| 1 | | discrepancy or audit finding if the documentation is | 2 | | received by the pharmacy benefit manager no later than the | 3 | | 45th day after the preliminary audit report was provided | 4 | | to the pharmacy or its contracting agent; the pharmacy | 5 | | benefit manager shall consider a reasonable request from | 6 | | the pharmacy for an extension of time to submit | 7 | | documentation to address or correct any findings in the | 8 | | report; | 9 | | (11) be required to provide the pharmacy or its | 10 | | contracting agent with the final audit report no later | 11 | | than 60 days after the initial audit report was provided | 12 | | to the pharmacy or its contracting agent; | 13 | | (12) conduct the audit in consultation with a | 14 | | pharmacist if the audit involves clinical or professional | 15 | | judgment; | 16 | | (13) not chargeback, recoup, or collect penalties from | 17 | | a pharmacy until the time period to file an appeal of the | 18 | | final pharmacy audit report has passed or the appeals | 19 | | process has been exhausted, whichever is later, unless the | 20 | | identified discrepancy is expected to exceed $25,000, in | 21 | | which case the auditing entity may withhold future | 22 | | payments in excess of that amount until the final | 23 | | resolution of the audit; | 24 | | (14) not compensate the employee or contractor | 25 | | conducting the audit based on a percentage of the amount | 26 | | claimed or recouped pursuant to the audit; |
| | | 10300SB0757sam001 | - 7 - | LRB103 03211 BMS 59435 a |
|
| 1 | | (15) not use extrapolation to calculate penalties or | 2 | | amounts to be charged back or recouped unless otherwise | 3 | | required by federal law or regulation; any amount to be | 4 | | charged back or recouped due to overpayment may not exceed | 5 | | the amount the pharmacy was overpaid; | 6 | | (16) not include dispensing fees in the calculation of | 7 | | overpayments unless a prescription is considered a | 8 | | misfill; and | 9 | | (17) conduct a pharmacy audit under the same standards | 10 | | and parameters as conducted for other similarly situated | 11 | | pharmacies audited by the auditing entity. | 12 | | (c) Except as otherwise provided by State or federal law, | 13 | | an auditing entity conducting a pharmacy audit may have access | 14 | | to a pharmacy's previous audit report only if the report was | 15 | | prepared by that auditing entity. | 16 | | (d) Information collected during a pharmacy audit shall be | 17 | | confidential by law, except that the auditing entity | 18 | | conducting the pharmacy audit may share the information with | 19 | | the health benefit plan for which a pharmacy audit is being | 20 | | conducted and with any regulatory agencies and law enforcement | 21 | | agencies as required by law. | 22 | | (e) A pharmacy may not be subject to a chargeback or | 23 | | recoupment for a clerical or recordkeeping error in a required | 24 | | document or record, including a typographical error or | 25 | | computer error, unless the pharmacy benefit manager can | 26 | | provide proof of intent to commit fraud or such error results |
| | | 10300SB0757sam001 | - 8 - | LRB103 03211 BMS 59435 a |
|
| 1 | | in actual financial harm to the pharmacy benefit manager, a | 2 | | health plan managed by the pharmacy benefit manager, or a | 3 | | consumer. | 4 | | (f) A pharmacy shall have the right to file a written | 5 | | appeal of a preliminary and final pharmacy audit report in | 6 | | accordance with the procedures established by the entity | 7 | | conducting the pharmacy audit. | 8 | | (g) No interest shall accrue for any party during the | 9 | | audit period, beginning with the notice of the pharmacy audit | 10 | | and ending with the conclusion of the appeals process. | 11 | | (h) A contract between a pharmacy or pharmacist and a | 12 | | pharmacy benefit manager must contain a provision allowing, | 13 | | during the course of a pharmacy audit conducted by or on behalf | 14 | | of a pharmacy benefit manager, a pharmacy or pharmacist to | 15 | | withdraw and resubmit a claim within 30 days after: | 16 | | (1) the preliminary written audit report is delivered | 17 | | if the pharmacy or pharmacist does not request an internal | 18 | | appeal; or | 19 | | (2) the conclusion of the internal audit appeals | 20 | | process if the pharmacy or pharmacist requests an internal | 21 | | audit appeal. | 22 | | (i) This Section shall not apply to: | 23 | | (1) audits in which suspected fraudulent activity or | 24 | | other intentional or willful misrepresentation is | 25 | | evidenced by a physical review, review of claims data or | 26 | | statements, or other investigative methods; |
| | | 10300SB0757sam001 | - 9 - | LRB103 03211 BMS 59435 a |
|
| 1 | | (2) audits of claims paid for by federally funded | 2 | | programs; or | 3 | | (3) concurrent reviews or desk audits that occur | 4 | | within 3 business days after transmission of a claim and | 5 | | in which no chargeback or recoupment is demanded. | 6 | | (j) A violation of this Section is an unfair and deceptive | 7 | | act or practice under Section 424. ".
|
|