Full Text of HB4595 102nd General Assembly
HB4595enr 102ND GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning regulation.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Insurance Code is amended by | 5 | | changing Sections 424 and 513b1 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, and 469 , and 513b1 of this Code.
| 15 | | (2) Entering into any agreement to commit, or by any | 16 | | concerted
action committing, any act of boycott, coercion | 17 | | or intimidation
resulting in or tending to result in | 18 | | unreasonable restraint of, or
monopoly in, the business of | 19 | | insurance.
| 20 | | (3) Making or permitting, in the case of insurance of | 21 | | the types
enumerated in Classes 1, 2, and 3 of Section 4, | 22 | | any unfair discrimination
between individuals or risks of | 23 | | the same class or of essentially the same
hazard and |
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| 1 | | expense element because of the race, color, religion, or | 2 | | national
origin of such insurance risks or applicants. The | 3 | | application of this Article
to the types of insurance | 4 | | enumerated in Class 1 of Section 4 shall in no way
limit, | 5 | | reduce, or impair the protections and remedies already | 6 | | provided for by
Sections 236 and 364 of this Code or any | 7 | | other provision of this Code.
| 8 | | (4) Engaging in any of the acts or practices defined | 9 | | in or prohibited by
Sections 154.5 through 154.8 of this | 10 | | Code.
| 11 | | (5) Making or charging any rate for insurance against | 12 | | losses arising
from the use or ownership of a motor | 13 | | vehicle which requires a higher
premium of any person by | 14 | | reason of his physical disability, race, color,
religion, | 15 | | or national origin.
| 16 | | (6) Failing to meet any requirement of the Unclaimed | 17 | | Life Insurance Benefits Act with such frequency as to | 18 | | constitute a general business practice. | 19 | | (Source: P.A. 99-143, eff. 7-27-15; 99-893, eff. 1-1-17 .)
| 20 | | (215 ILCS 5/513b1) | 21 | | Sec. 513b1. Pharmacy benefit manager contracts. | 22 | | (a) As used in this Section: | 23 | | "340B drug discount program" means the program established
| 24 | | under Section 340B of the federal Public Health Service Act, | 25 | | 42 U.S.C. 256b. |
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| 1 | | "340B entity" means a covered entity as defined in 42 | 2 | | U.S.C. 256b(a)(4) authorized to participate in the 340B drug | 3 | | discount program. | 4 | | "340B pharmacy" means any pharmacy used to dispense 340B | 5 | | drugs for a covered entity, whether entity-owned or external. | 6 | | "Biological product" has the meaning ascribed to that term | 7 | | in Section 19.5 of the Pharmacy Practice Act. | 8 | | "Maximum allowable cost" means the maximum amount that a | 9 | | pharmacy benefit manager will reimburse a pharmacy for the | 10 | | cost of a drug. | 11 | | "Maximum allowable cost list" means a list of drugs for | 12 | | which a maximum allowable cost has been established by a | 13 | | pharmacy benefit manager. | 14 | | "Pharmacy benefit manager" means a person, business, or | 15 | | entity, including a wholly or partially owned or controlled | 16 | | subsidiary of a pharmacy benefit manager, that provides claims | 17 | | processing services or other prescription drug or device | 18 | | services, or both, for health benefit plans. | 19 | | "Retail price" means the price an individual without | 20 | | prescription drug coverage would pay at a retail pharmacy, not | 21 | | including a pharmacist dispensing fee. | 22 | | "Third-party payer" means any entity that pays for | 23 | | prescription drugs on behalf of a patient other than a health | 24 | | care provider or sponsor of a plan subject to regulation under | 25 | | Medicare Part D, 42 U.S.C. 1395w–101, et seq. | 26 | | (b) A contract between a health insurer and a pharmacy |
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| 1 | | benefit manager must require that the pharmacy benefit | 2 | | manager: | 3 | | (1) Update maximum allowable cost pricing information | 4 | | at least every 7 calendar days. | 5 | | (2) Maintain a process that will, in a timely manner, | 6 | | eliminate drugs from maximum allowable cost lists or | 7 | | modify drug prices to remain consistent with changes in | 8 | | pricing data used in formulating maximum allowable cost | 9 | | prices and product availability. | 10 | | (3) Provide access to its maximum allowable cost list | 11 | | to each pharmacy or pharmacy services administrative | 12 | | organization subject to the maximum allowable cost list. | 13 | | Access may include a real-time pharmacy website portal to | 14 | | be able to view the maximum allowable cost list. As used in | 15 | | this Section, "pharmacy services administrative | 16 | | organization" means an entity operating within the State | 17 | | that contracts with independent pharmacies to conduct | 18 | | business on their behalf with third-party payers. A | 19 | | pharmacy services administrative organization may provide | 20 | | administrative services to pharmacies and negotiate and | 21 | | enter into contracts with third-party payers or pharmacy | 22 | | benefit managers on behalf of pharmacies. | 23 | | (4) Provide a process by which a contracted pharmacy | 24 | | can appeal the provider's reimbursement for a drug subject | 25 | | to maximum allowable cost pricing. The appeals process | 26 | | must, at a minimum, include the following: |
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| 1 | | (A) A requirement that a contracted pharmacy has | 2 | | 14 calendar days after the applicable fill date to | 3 | | appeal a maximum allowable cost if the reimbursement | 4 | | for the drug is less than the net amount that the | 5 | | network provider paid to the supplier of the drug. | 6 | | (B) A requirement that a pharmacy benefit manager | 7 | | must respond to a challenge within 14 calendar days of | 8 | | the contracted pharmacy making the claim for which the | 9 | | appeal has been submitted. | 10 | | (C) A telephone number and e-mail address or | 11 | | website to network providers, at which the provider | 12 | | can contact the pharmacy benefit manager to process | 13 | | and submit an appeal. | 14 | | (D) A requirement that, if an appeal is denied, | 15 | | the pharmacy benefit manager must provide the reason | 16 | | for the denial and the name and the national drug code | 17 | | number from national or regional wholesalers. | 18 | | (E) A requirement that, if an appeal is sustained, | 19 | | the pharmacy benefit manager must make an adjustment | 20 | | in the drug price effective the date the challenge is | 21 | | resolved and make the adjustment applicable to all | 22 | | similarly situated network pharmacy providers, as | 23 | | determined by the managed care organization or | 24 | | pharmacy benefit manager. | 25 | | (5) Allow a plan sponsor contracting with a pharmacy | 26 | | benefit manager an annual right to audit compliance with |
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| 1 | | the terms of the contract by the pharmacy benefit manager, | 2 | | including, but not limited to, full disclosure of any and | 3 | | all rebate amounts secured, whether product specific or | 4 | | generalized rebates, that were provided to the pharmacy | 5 | | benefit manager by a pharmaceutical manufacturer. | 6 | | (6) Allow a plan sponsor contracting with a pharmacy | 7 | | benefit manager to request that the pharmacy benefit | 8 | | manager disclose the actual amounts paid by the pharmacy | 9 | | benefit manager to the pharmacy. | 10 | | (7) Provide notice to the party contracting with the | 11 | | pharmacy benefit manager of any consideration that the | 12 | | pharmacy benefit manager receives from the manufacturer | 13 | | for dispense as written prescriptions once a generic or | 14 | | biologically similar product becomes available. | 15 | | (c) In order to place a particular prescription drug on a | 16 | | maximum allowable cost list, the pharmacy benefit manager | 17 | | must, at a minimum, ensure that: | 18 | | (1) if the drug is a generically equivalent drug, it | 19 | | is listed as therapeutically equivalent and | 20 | | pharmaceutically equivalent "A" or "B" rated in the United | 21 | | States Food and Drug Administration's most recent version | 22 | | of the "Orange Book" or have an NR or NA rating by | 23 | | Medi-Span, Gold Standard, or a similar rating by a | 24 | | nationally recognized reference; | 25 | | (2) the drug is available for purchase by each | 26 | | pharmacy in the State from national or regional |
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| 1 | | wholesalers operating in Illinois; and | 2 | | (3) the drug is not obsolete. | 3 | | (d) A pharmacy benefit manager is prohibited from limiting | 4 | | a pharmacist's ability to disclose whether the cost-sharing | 5 | | obligation exceeds the retail price for a covered prescription | 6 | | drug, and the availability of a more affordable alternative | 7 | | drug, if one is available in accordance with Section 42 of the | 8 | | Pharmacy Practice Act. | 9 | | (e) A health insurer or pharmacy benefit manager shall not | 10 | | require an insured to make a payment for a prescription drug at | 11 | | the point of sale in an amount that exceeds the lesser of: | 12 | | (1) the applicable cost-sharing amount; or | 13 | | (2) the retail price of the drug in the absence of | 14 | | prescription drug coverage. | 15 | | (f) Unless required by law, a contract between a pharmacy | 16 | | benefit manager or third-party payer and a 340B entity or 340B | 17 | | pharmacy shall not contain any provision that: | 18 | | (1) distinguishes between drugs purchased through the | 19 | | 340B drug discount program and other drugs when | 20 | | determining reimbursement or reimbursement methodologies, | 21 | | or contains otherwise less favorable payment terms or | 22 | | reimbursement methodologies for 340B entities or 340B | 23 | | pharmacies when compared to similarly situated non-340B | 24 | | entities; | 25 | | (2) imposes any fee, chargeback, or rate adjustment | 26 | | that is not similarly imposed on similarly situated |
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| 1 | | pharmacies that are not 340B entities or 340B pharmacies; | 2 | | (3) imposes any fee, chargeback, or rate adjustment | 3 | | that exceeds the fee, chargeback, or rate adjustment that | 4 | | is not similarly imposed on similarly situated pharmacies | 5 | | that are not 340B entities or 340B pharmacies; | 6 | | (4) prevents or interferes with an individual's choice | 7 | | to receive a covered prescription drug from a 340B entity | 8 | | or 340B pharmacy through any legally permissible means, | 9 | | except that nothing in this paragraph shall prohibit the | 10 | | establishment of differing copayments or other | 11 | | cost-sharing amounts within the benefit plan for covered | 12 | | persons who acquire covered prescription drugs from a | 13 | | nonpreferred or nonparticipating provider; | 14 | | (5) excludes a 340B entity or 340B pharmacy from a | 15 | | pharmacy network on any basis that includes consideration | 16 | | of whether the 340B entity or 340B pharmacy participates | 17 | | in the 340B drug discount program; | 18 | | (6) prevents a 340B entity or 340B pharmacy from using | 19 | | a drug purchased under the 340B drug discount program; or | 20 | | (7) any other provision that discriminates against a | 21 | | 340B entity or 340B pharmacy by treating the 340B entity | 22 | | or 340B pharmacy differently than non-340B entities or | 23 | | non-340B pharmacies for any reason relating to the | 24 | | entity's participation in the 340B drug discount program. | 25 | | As used in this subsection, "pharmacy benefit manager" and | 26 | | "third-party payer" do not include pharmacy benefit managers |
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| 1 | | and third-party payers acting on behalf of a Medicaid program. | 2 | | (g) A violation of this Section by a pharmacy benefit | 3 | | manager constitutes an unfair or deceptive act or practice in | 4 | | the business of insurance under Section 424. | 5 | | (h) A provision that violates subsection (f) in a contract | 6 | | between a pharmacy benefit manager or a third-party payer and | 7 | | a 340B entity that is entered into, amended, or renewed after | 8 | | July 1, 2022 shall be void and unenforceable. | 9 | | (i) (f) This Section applies to contracts entered into or | 10 | | renewed on or after July 1, 2022 2020 . | 11 | | (j) (g) This Section applies to any group or individual | 12 | | policy of accident and health insurance or managed care plan | 13 | | that provides coverage for prescription drugs and that is | 14 | | amended, delivered, issued, or renewed on or after July 1, | 15 | | 2020.
| 16 | | (Source: P.A. 101-452, eff. 1-1-20 .) | 17 | | Section 10. The Illinois Public Aid Code is amended by | 18 | | changing Sections 5-5.12 and 5-36 as follows:
| 19 | | (305 ILCS 5/5-5.12) (from Ch. 23, par. 5-5.12)
| 20 | | Sec. 5-5.12. Pharmacy payments.
| 21 | | (a) Every request submitted by a pharmacy for | 22 | | reimbursement under this
Article for prescription drugs | 23 | | provided to a recipient of aid under this
Article shall | 24 | | include the name of the prescriber or an acceptable
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| 1 | | identification number as established by the Department.
| 2 | | (b) Pharmacies providing prescription drugs under
this | 3 | | Article shall be reimbursed at a rate which shall include
a | 4 | | professional dispensing fee as determined by the Illinois
| 5 | | Department, plus the current acquisition cost of the | 6 | | prescription
drug dispensed. The Illinois Department shall | 7 | | update its
information on the acquisition costs of all | 8 | | prescription drugs
no less frequently than every 30 days. | 9 | | However, the Illinois
Department may set the rate of | 10 | | reimbursement for the acquisition
cost, by rule, at a | 11 | | percentage of the current average wholesale
acquisition cost.
| 12 | | (c) (Blank).
| 13 | | (d) The Department shall review utilization of narcotic | 14 | | medications in the medical assistance program and impose | 15 | | utilization controls that protect against abuse.
| 16 | | (e) When making determinations as to which drugs shall be | 17 | | on a prior approval list, the Department shall include as part | 18 | | of the analysis for this determination, the degree to which a | 19 | | drug may affect individuals in different ways based on factors | 20 | | including the gender of the person taking the medication. | 21 | | (f) The Department shall cooperate with the Department of | 22 | | Public Health and the Department of Human Services Division of | 23 | | Mental Health in identifying psychotropic medications that, | 24 | | when given in a particular form, manner, duration, or | 25 | | frequency (including "as needed") in a dosage, or in | 26 | | conjunction with other psychotropic medications to a nursing |
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| 1 | | home resident or to a resident of a facility licensed under the | 2 | | ID/DD Community Care Act or the MC/DD Act, may constitute a | 3 | | chemical restraint or an "unnecessary drug" as defined by the | 4 | | Nursing Home Care Act or Titles XVIII and XIX of the Social | 5 | | Security Act and the implementing rules and regulations. The | 6 | | Department shall require prior approval for any such | 7 | | medication prescribed for a nursing home resident or to a | 8 | | resident of a facility licensed under the ID/DD Community Care | 9 | | Act or the MC/DD Act, that appears to be a chemical restraint | 10 | | or an unnecessary drug. The Department shall consult with the | 11 | | Department of Human Services Division of Mental Health in | 12 | | developing a protocol and criteria for deciding whether to | 13 | | grant such prior approval. | 14 | | (g) The Department may by rule provide for reimbursement | 15 | | of the dispensing of a 90-day supply of a generic or brand | 16 | | name, non-narcotic maintenance medication in circumstances | 17 | | where it is cost effective. | 18 | | (g-5) On and after July 1, 2012, the Department may | 19 | | require the dispensing of drugs to nursing home residents be | 20 | | in a 7-day supply or other amount less than a 31-day supply. | 21 | | The Department shall pay only one dispensing fee per 31-day | 22 | | supply. | 23 | | (h) Effective July 1, 2011, the Department shall | 24 | | discontinue coverage of select over-the-counter drugs, | 25 | | including analgesics and cough and cold and allergy | 26 | | medications. |
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| 1 | | (h-5) On and after July 1, 2012, the Department shall | 2 | | impose utilization controls, including, but not limited to, | 3 | | prior approval on specialty drugs, oncolytic drugs, drugs for | 4 | | the treatment of HIV or AIDS, immunosuppressant drugs, and | 5 | | biological products in order to maximize savings on these | 6 | | drugs. The Department may adjust payment methodologies for | 7 | | non-pharmacy billed drugs in order to incentivize the | 8 | | selection of lower-cost drugs. For drugs for the treatment of | 9 | | AIDS, the Department shall take into consideration the | 10 | | potential for non-adherence by certain populations, and shall | 11 | | develop protocols with organizations or providers primarily | 12 | | serving those with HIV/AIDS, as long as such measures intend | 13 | | to maintain cost neutrality with other utilization management | 14 | | controls such as prior approval.
For hemophilia, the | 15 | | Department shall develop a program of utilization review and | 16 | | control which may include, in the discretion of the | 17 | | Department, prior approvals. The Department may impose special | 18 | | standards on providers that dispense blood factors which shall | 19 | | include, in the discretion of the Department, staff training | 20 | | and education; patient outreach and education; case | 21 | | management; in-home patient assessments; assay management; | 22 | | maintenance of stock; emergency dispensing timeframes; data | 23 | | collection and reporting; dispensing of supplies related to | 24 | | blood factor infusions; cold chain management and packaging | 25 | | practices; care coordination; product recalls; and emergency | 26 | | clinical consultation. The Department may require patients to |
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| 1 | | receive a comprehensive examination annually at an appropriate | 2 | | provider in order to be eligible to continue to receive blood | 3 | | factor. | 4 | | (i) On and after July 1, 2012, the Department shall reduce | 5 | | any rate of reimbursement for services or other payments or | 6 | | alter any methodologies authorized by this Code to reduce any | 7 | | rate of reimbursement for services or other payments in | 8 | | accordance with Section 5-5e. | 9 | | (j) On and after July 1, 2012, the Department shall impose | 10 | | limitations on prescription drugs such that the Department | 11 | | shall not provide reimbursement for more than 4 prescriptions, | 12 | | including 3 brand name prescriptions, for distinct drugs in a | 13 | | 30-day period, unless prior approval is received for all | 14 | | prescriptions in excess of the 4-prescription limit. Drugs in | 15 | | the following therapeutic classes shall not be subject to | 16 | | prior approval as a result of the 4-prescription limit: | 17 | | immunosuppressant drugs, oncolytic drugs, anti-retroviral | 18 | | drugs, and, on or after July 1, 2014, antipsychotic drugs. On | 19 | | or after July 1, 2014, the Department may exempt children with | 20 | | complex medical needs enrolled in a care coordination entity | 21 | | contracted with the Department to solely coordinate care for | 22 | | such children, if the Department determines that the entity | 23 | | has a comprehensive drug reconciliation program. | 24 | | (k) No medication therapy management program implemented | 25 | | by the Department shall be contrary to the provisions of the | 26 | | Pharmacy Practice Act. |
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| 1 | | (l) Any provider enrolled with the Department that bills | 2 | | the Department for outpatient drugs and is eligible to enroll | 3 | | in the federal Drug Pricing Program under Section 340B of the | 4 | | federal Public Health Service Act shall enroll in that | 5 | | program. No entity participating in the federal Drug Pricing | 6 | | Program under Section 340B of the federal Public Health | 7 | | Service Act may exclude fee-for-service Medicaid from their | 8 | | participation in that program, however, although the | 9 | | Department may exclude entities defined in Section | 10 | | 1905(l)(2)(B) of the Social Security Act are excluded from | 11 | | this requirement. This subsection does not apply to outpatient | 12 | | drugs billed to Medicaid managed care organizations. | 13 | | (Source: P.A. 102-558, eff. 8-20-21.)
| 14 | | (305 ILCS 5/5-36) | 15 | | Sec. 5-36. Pharmacy benefits. | 16 | | (a)(1) The Department may enter into a contract with a | 17 | | third party on a fee-for-service reimbursement model for the | 18 | | purpose of administering pharmacy benefits as provided in this | 19 | | Section for members not enrolled in a Medicaid managed care | 20 | | organization; however, these services shall be approved by the | 21 | | Department. The Department shall ensure coordination of care | 22 | | between the third-party administrator and managed care | 23 | | organizations as a consideration in any contracts established | 24 | | in accordance with this Section. Any managed care techniques, | 25 | | principles, or administration of benefits utilized in |
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| 1 | | accordance with this subsection shall comply with State law. | 2 | | (2) The following shall apply to contracts between | 3 | | entities contracting relating to the Department's third-party | 4 | | administrators and pharmacies: | 5 | | (A) the Department shall approve any contract between | 6 | | a third-party administrator and a pharmacy; | 7 | | (B) the Department's third-party administrator shall | 8 | | not change the terms of a contract between a third-party | 9 | | administrator and a pharmacy without written approval by | 10 | | the Department; and | 11 | | (C) the Department's third-party administrator shall | 12 | | not create, modify, implement, or indirectly establish any | 13 | | fee on a pharmacy, pharmacist, or a recipient of medical | 14 | | assistance without written approval by the Department. | 15 | | (b) The provisions of this Section shall not apply to | 16 | | outpatient pharmacy services provided by a health care | 17 | | facility registered as a covered entity pursuant to 42 U.S.C. | 18 | | 256b or any pharmacy owned by or contracted with the covered | 19 | | entity. A Medicaid managed care organization shall, either | 20 | | directly or through a pharmacy benefit manager, administer and | 21 | | reimburse outpatient pharmacy claims submitted by a health | 22 | | care facility registered as a covered entity pursuant to 42 | 23 | | U.S.C. 256b, its owned pharmacies, and contracted pharmacies | 24 | | in accordance with the contractual agreements the Medicaid | 25 | | managed care organization or its pharmacy benefit manager has | 26 | | with such facilities and pharmacies and in accordance with |
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| 1 | | subsection (h-5) . | 2 | | (b-5) Any pharmacy benefit manager that contracts with a | 3 | | Medicaid managed care organization to administer and reimburse | 4 | | pharmacy claims as provided in this Section must be registered | 5 | | with the Director of Insurance in accordance with Section | 6 | | 513b2 of the Illinois Insurance Code. | 7 | | (c) On at least an annual basis, the Director of the | 8 | | Department of Healthcare and Family Services shall submit a | 9 | | report beginning no later than one year after January 1, 2020 | 10 | | (the effective date of Public Act 101-452) that provides an | 11 | | update on any contract, contract issues, formulary, dispensing | 12 | | fees, and maximum allowable cost concerns regarding a | 13 | | third-party administrator and managed care. The requirement | 14 | | for reporting to the General Assembly shall be satisfied by | 15 | | filing copies of the report with the Speaker, the Minority | 16 | | Leader, and the Clerk of the House of Representatives and with | 17 | | the President, the Minority Leader, and the Secretary of the | 18 | | Senate. The Department shall take care that no proprietary | 19 | | information is included in the report required under this | 20 | | Section. | 21 | | (d) A pharmacy benefit manager shall notify the Department | 22 | | in writing of any activity, policy, or practice of the | 23 | | pharmacy benefit manager that directly or indirectly presents | 24 | | a conflict of interest that interferes with the discharge of | 25 | | the pharmacy benefit manager's duty to a managed care | 26 | | organization to exercise its contractual duties. "Conflict of |
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| 1 | | interest" shall be defined by rule by the Department. | 2 | | (e) A pharmacy benefit manager shall, upon request, | 3 | | disclose to the Department the following information: | 4 | | (1) whether the pharmacy benefit manager has a | 5 | | contract, agreement, or other arrangement with a | 6 | | pharmaceutical manufacturer to exclusively dispense or | 7 | | provide a drug to a managed care organization's enrollees, | 8 | | and the aggregate amounts of consideration of economic | 9 | | benefits collected or received pursuant to that | 10 | | arrangement; | 11 | | (2) the percentage of claims payments made by the | 12 | | pharmacy benefit manager to pharmacies owned, managed, or | 13 | | controlled by the pharmacy benefit manager or any of the | 14 | | pharmacy benefit manager's management companies, parent | 15 | | companies, subsidiary companies, or jointly held | 16 | | companies; | 17 | | (3) the aggregate amount of the fees or assessments | 18 | | imposed on, or collected from, pharmacy providers; and | 19 | | (4) the average annualized percentage of revenue | 20 | | collected by the pharmacy benefit manager as a result of | 21 | | each contract it has executed with a managed care | 22 | | organization contracted by the Department to provide | 23 | | medical assistance benefits which is not paid by the | 24 | | pharmacy benefit manager to pharmacy providers and | 25 | | pharmaceutical manufacturers or labelers or in order to | 26 | | perform administrative functions pursuant to its contracts |
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| 1 | | with managed care organizations. | 2 | | (f) The information disclosed under subsection (e) shall | 3 | | include all retail, mail order, specialty, and compounded | 4 | | prescription products. All information made
available to the | 5 | | Department under subsection (e) is confidential and not | 6 | | subject to disclosure under the Freedom of Information Act. | 7 | | All information made available to the Department under | 8 | | subsection (e) shall not be reported or distributed in any way | 9 | | that compromises its competitive, proprietary, or financial | 10 | | value. The information shall only be used by the Department to | 11 | | assess the contract, agreement, or other arrangements made | 12 | | between a pharmacy benefit manager and a pharmacy provider, | 13 | | pharmaceutical manufacturer or labeler, managed care | 14 | | organization, or other entity, as applicable. | 15 | | (g) A pharmacy benefit manager shall disclose directly in | 16 | | writing to a pharmacy provider or pharmacy services | 17 | | administrative organization contracting with the pharmacy | 18 | | benefit manager of any material change to a contract provision | 19 | | that affects the terms of the reimbursement, the process for | 20 | | verifying benefits and eligibility, dispute resolution, | 21 | | procedures for verifying drugs included on the formulary, and | 22 | | contract termination at least 30 days prior to the date of the | 23 | | change to the provision. The terms of this subsection shall be | 24 | | deemed met if the pharmacy benefit manager posts the | 25 | | information on a website, viewable by the public. A pharmacy | 26 | | service administration organization shall notify all contract |
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| 1 | | pharmacies of any material change, as described in this | 2 | | subsection, within 2 days of notification. As used in this | 3 | | Section, "pharmacy services administrative organization" means | 4 | | an entity operating within the State that contracts with | 5 | | independent pharmacies to conduct business on their behalf | 6 | | with third-party payers. A pharmacy services administrative | 7 | | organization may provide administrative services to pharmacies | 8 | | and negotiate and enter into contracts with third-party payers | 9 | | or pharmacy benefit managers on behalf of pharmacies. | 10 | | (h) A pharmacy benefit manager shall not include the | 11 | | following in a contract with a pharmacy provider: | 12 | | (1) a provision prohibiting the provider from | 13 | | informing a patient of a less costly alternative to a | 14 | | prescribed medication; or | 15 | | (2) a provision that prohibits the provider from | 16 | | dispensing a particular amount of a prescribed medication, | 17 | | if the pharmacy benefit manager allows that amount to be | 18 | | dispensed through a pharmacy owned or controlled by the | 19 | | pharmacy benefit manager, unless the prescription drug is | 20 | | subject to restricted distribution by the United States | 21 | | Food and Drug Administration or requires special handling, | 22 | | provider coordination, or patient education that cannot be | 23 | | provided by a retail pharmacy. | 24 | | (h-5) Unless required by law, a Medicaid managed care | 25 | | organization or pharmacy benefit manager administering or | 26 | | managing benefits on behalf of a Medicaid managed care |
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| 1 | | organization shall not refuse to contract with a 340B entity | 2 | | or 340B pharmacy for refusing to accept less favorable payment | 3 | | terms or reimbursement methodologies when compared to | 4 | | similarly situated non-340B entities and shall not include in | 5 | | a contract with a 340B entity or 340B pharmacy a provision | 6 | | that: | 7 | | (1) imposes any fee, chargeback, or rate adjustment | 8 | | that is not similarly imposed on similarly situated | 9 | | pharmacies that are not 340B entities or 340B pharmacies; | 10 | | (2) imposes any fee, chargeback, or rate adjustment | 11 | | that exceeds the fee, chargeback, or rate adjustment that | 12 | | is not similarly imposed on similarly situated pharmacies | 13 | | that are not 340B entities or 340B pharmacies; | 14 | | (3) prevents or interferes with an individual's choice | 15 | | to receive a prescription drug from a 340B entity or 340B | 16 | | pharmacy through any legally permissible means; | 17 | | (4) excludes a 340B entity or 340B pharmacy from a | 18 | | pharmacy network on the basis of whether the 340B entity | 19 | | or 340B pharmacy participates in the 340B drug discount | 20 | | program; | 21 | | (5) prevents a 340B entity or 340B pharmacy from using | 22 | | a drug purchased under the 340B drug discount program so | 23 | | long as the drug recipient is a patient of the 340B entity; | 24 | | nothing in this Section exempts a 340B pharmacy from | 25 | | following the Department's preferred drug list or from any | 26 | | prior approval requirements of the Department or the |
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| 1 | | Medicaid managed care organization that are imposed on the | 2 | | drug for all pharmacies; or | 3 | | (6) any other provision that discriminates against a | 4 | | 340B entity or 340B pharmacy by treating a 340B entity or | 5 | | 340B pharmacy differently than non-340B entities or | 6 | | non-340B pharmacies for any reason relating to the | 7 | | entity's participation in the 340B drug discount program. | 8 | | A provision that violates this subsection in any contract | 9 | | between a Medicaid managed care organization or its pharmacy | 10 | | benefit manager and a 340B entity entered into, amended, or | 11 | | renewed after July 1, 2022 shall be void and unenforceable. | 12 | | In this subsection (h-5): | 13 | | "340B entity" means a covered entity as defined in 42 | 14 | | U.S.C. 256b(a)(4) authorized to participate in the 340B drug | 15 | | discount program. | 16 | | "340B pharmacy" means any pharmacy used to dispense 340B | 17 | | drugs for a covered entity, whether entity-owned or external. | 18 | | (i) Nothing in this Section shall be construed to prohibit | 19 | | a pharmacy benefit manager from requiring the same | 20 | | reimbursement and terms and conditions for a pharmacy provider | 21 | | as for a pharmacy owned, controlled, or otherwise associated | 22 | | with the pharmacy benefit manager. | 23 | | (j) A pharmacy benefit manager shall establish and | 24 | | implement a process for the resolution of disputes arising out | 25 | | of this Section, which shall be approved by the Department. | 26 | | (k) The Department shall adopt rules establishing |
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| 1 | | reasonable dispensing fees for fee-for-service payments in | 2 | | accordance with guidance or guidelines from the federal | 3 | | Centers for Medicare and Medicaid Services.
| 4 | | (Source: P.A. 101-452, eff. 1-1-20; 102-558, eff. 8-20-21.)
| 5 | | Section 99. Effective date. This Act takes effect July 1, | 6 | | 2022. |
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