Bill Text: IA HSB519 | 2013-2014 | 85th General Assembly | Introduced
Bill Title: A study bill relating to the regulation of pharmacy benefit managers.
Spectrum: Unknown
Status: (N/A - Dead) 2014-01-22 - In Commerce [HSB519 Detail]
Download: Iowa-2013-HSB519-Introduced.html
House
Study
Bill
519
-
Introduced
HOUSE
FILE
_____
BY
(PROPOSED
COMMITTEE
ON
COMMERCE
BILL
BY
CHAIRPERSON
COWNIE)
A
BILL
FOR
An
Act
relating
to
the
regulation
of
pharmacy
benefit
managers.
1
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
2
TLSB
5250HC
(5)
85
av/nh
H.F.
_____
Section
1.
Section
510B.1,
Code
2014,
is
amended
by
adding
1
the
following
new
subsection:
2
NEW
SUBSECTION
.
5A.
“Maximum
reimbursement
amount”
means
3
the
maximum
reimbursement
amount
for
a
therapeutically
and
4
pharmaceutically
equivalent
multiple-source
prescription
drug
5
that
is
listed
in
the
most
recent
edition
of
the
publication
6
entitled
approved
drug
products
with
therapeutic
equivalence
7
evaluations,
published
by
the
United
States
food
and
drug
8
administration,
otherwise
known
as
the
orange
book.
9
Sec.
2.
NEW
SECTION
.
510B.8
Proof
of
financial
solvency.
10
1.
The
commissioner
may
require
a
pharmacy
benefits
manager
11
to
submit
information
to
the
commissioner
related
to
the
12
pharmacy
benefits
manager’s
financial
solvency
in
accordance
13
with
chapter
507,
including
but
not
limited
to
disclosure
of
14
pricing
methodology
and
rebate
information.
15
2.
For
purposes
of
the
disclosure
of
pricing
methodology,
16
maximum
reimbursement
amounts
shall
be
implemented
as
follows:
17
a.
Established
for
multiple
source
prescription
drugs
18
prescribed
after
the
expiration
of
any
generic
exclusivity
19
period.
20
b.
Established
for
any
prescription
drug
with
at
least
two
21
or
more
A-rated
therapeutically
equivalent,
multiple
source
22
prescription
drugs
with
a
significant
cost
difference.
23
c.
Determined
using
comparable
prescription
drug
prices
24
obtained
from
multiple
nationally
recognized
comprehensive
data
25
sources
including
wholesalers,
prescription
drug
file
vendors,
26
and
pharmaceutical
manufacturers
for
prescription
drugs
that
27
are
nationally
available
and
available
for
purchase
locally
by
28
multiple
pharmacies
in
the
state.
29
3.
For
those
prescription
drugs
to
which
maximum
30
reimbursement
amount
pricing
applies,
a
pharmacy
benefits
31
manager
shall
include
in
a
contract
with
a
pharmacy
information
32
regarding
which
of
the
national
compendia
is
used
to
33
obtain
pricing
data
used
in
the
calculation
of
the
maximum
34
reimbursement
amount
pricing
and
shall
provide
a
process
to
35
-1-
LSB
5250HC
(5)
85
av/nh
1/
4
H.F.
_____
allow
a
pharmacy
to
comment
on,
contest,
or
appeal
the
maximum
1
reimbursement
amount
rates
or
maximum
reimbursement
amount
2
list.
The
right
to
comment
on,
contest,
or
appeal
the
maximum
3
reimbursement
amount
rates
or
maximum
reimbursement
amount
list
4
shall
be
limited
in
duration
and
allow
for
retroactive
payment
5
in
the
event
that
it
is
determined
that
maximum
reimbursement
6
amount
pricing
has
been
applied
incorrectly.
7
4.
For
purposes
of
the
disclosure
of
rebate
information,
8
the
commissioner,
in
conjunction
with
an
examination
authorized
9
under
this
chapter
or
chapter
507,
507B,
or
510,
may
request,
10
and
a
pharmacy
benefits
manager
shall
disclose
to
the
11
commissioner,
the
amount
of
all
rebate
revenues
and
the
nature,
12
type,
and
amounts
of
all
other
revenues
that
the
pharmacy
13
benefits
manager
receives
from
each
pharmaceutical
manufacturer
14
or
labeler
with
whom
the
pharmacy
benefits
manager
has
a
15
contract.
The
pharmacy
benefits
manager
shall
disclose
to
the
16
commissioner,
including
but
not
limited
to
all
of
the
following
17
information:
18
a.
Both
the
aggregate
amount,
and
the
specific
amounts
for
19
each
prescription
drug,
of
all
rebates
and
other
retrospective
20
utilization
discounts
received
by
the
pharmacy
benefits
21
manager,
directly
or
indirectly,
from
each
pharmaceutical
22
manufacturer
or
labeler
that
are
earned
in
connection
with
the
23
dispensing
of
prescription
drugs
to
covered
individuals
of
24
the
health
benefit
plans
issued
by
a
pharmacy
or
for
which
a
25
pharmacy
is
the
designated
administrator.
26
b.
The
nature,
type,
and
amount
of
all
other
revenue
27
received
by
the
pharmacy
benefits
manager
directly
or
28
indirectly
from
each
pharmaceutical
manufacturer
or
labeler
for
29
any
other
products
or
services
provided
to
the
pharmaceutical
30
manufacturer
or
labeler
by
the
pharmacy
benefits
manager
with
31
respect
to
programs
that
a
pharmacy
offers
or
provides
to
32
covered
individuals.
33
c.
Any
prescription
drug
utilization
information
requested
34
by
a
pharmacy
relating
to
covered
individuals.
35
-2-
LSB
5250HC
(5)
85
av/nh
2/
4
H.F.
_____
EXPLANATION
1
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
2
the
explanation’s
substance
by
the
members
of
the
general
assembly.
3
This
bill
relates
to
the
regulation
of
pharmacy
benefit
4
managers.
The
bill
authorizes
the
commissioner
of
insurance
5
to
require
a
pharmacy
benefits
manager
to
submit
information
6
to
the
commissioner
related
to
the
pharmacy
benefit
manager’s
7
financial
solvency,
including
information
disclosing
8
pricing
methodology
and
rebates
received,
pursuant
to
the
9
commissioner’s
power
to
examine
insurance
companies
under
Code
10
chapter
507.
11
The
bill
provides
that
for
purposes
of
the
disclosure
of
12
pricing
methodology,
a
pharmacy
benefits
manager
must
use
13
maximum
reimbursement
amounts
that
meet
specified
criteria.
14
“Maximum
reimbursement
amount”
is
defined
as
the
maximum
15
reimbursement
amount
for
a
therapeutically
and
pharmaceutically
16
equivalent
multiple-source
prescription
drug
that
is
listed
in
17
the
United
States
food
and
drug
administration’s
publication
18
entitled
approved
drug
products
with
therapeutic
equivalence
19
evaluations,
otherwise
known
as
the
orange
book.
20
For
those
prescription
drugs
to
which
maximum
reimbursement
21
amount
pricing
applies,
a
pharmacy
benefits
manager
must
22
include
information
in
a
contract
with
a
pharmacy
showing
how
23
maximum
reimbursement
amount
pricing
is
calculated
and
allowing
24
the
pharmacy
the
opportunity
to
comment
on,
contest,
or
appeal
25
the
maximum
reimbursement
amount
rates
and
list.
The
contract
26
must
also
allow
for
retroactive
payment
if
it
is
determined
27
that
maximum
reimbursement
amount
pricing
has
been
applied
28
incorrectly.
29
The
bill
also
provides
that
for
purposes
of
disclosure
of
30
rebate
information,
the
commissioner
in
conjunction
with
an
31
examination
authorized
under
Code
chapter
507
(examination
32
of
insurance
companies),
507B
(regulation
of
insurance
trade
33
practices),
510
(regulation
of
managing
general
agents
and
34
third-party
administrators),
or
510B
(regulation
of
pharmacy
35
-3-
LSB
5250HC
(5)
85
av/nh
3/
4
H.F.
_____
benefits
managers),
can
request
information
from
a
pharmacy
1
benefits
manager
concerning
the
amount
of
all
rebate
revenues,
2
and
the
nature,
type,
and
amounts
of
all
other
revenues
that
3
the
pharmacy
benefits
manager
receives
from
each
pharmaceutical
4
manufacturer
or
labeler
with
whom
the
pharmacy
benefits
5
manager
has
a
contract.
The
bill
specifies
information
which
6
a
pharmacy
benefits
manager
must
disclose
pursuant
to
such
a
7
request
by
the
commissioner.
8
-4-
LSB
5250HC
(5)
85
av/nh
4/
4
